DEFM14A
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

(RULE 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant  ☒                            Filed by a Party other than the Registrant  ☐

Check the appropriate box:

 

  Preliminary Proxy Statement
  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
  Definitive Proxy Statement
  Definitive Additional Materials
  Soliciting Material Pursuant to §240.14a-12

Progenics Pharmaceuticals, Inc.

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

  No fee required.
  Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)  

Title of each class of securities to which transaction applies:

 

  (2)  

Aggregate number of securities to which transaction applies:

 

  (3)  

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

  (4)  

Proposed maximum aggregate value of transaction:

 

  (5)  

Total fee paid:

 

  Fee paid previously with preliminary materials.
  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
  (1)  

Amount Previously Paid:

 

     

  (2)  

Form, Schedule or Registration Statement No.:

 

     

  (3)  

Filing Party:

 

     

  (4)  

Date Filed:

 

     

 

 

 


Table of Contents

 

 

 

LOGO    LOGO

MERGER PROPOSAL—YOUR VOTE IS VERY IMPORTANT

March 19, 2020

Dear Stockholders:

On behalf of the boards of directors of Lantheus Holdings, Inc. (“Lantheus Holdings”) and Progenics Pharmaceuticals, Inc. (“Progenics”), we are pleased to enclose the joint proxy statement/prospectus relating to the merger of Progenics with a wholly-owned subsidiary of Lantheus Holdings (the “merger”) pursuant to the terms of an amended and restated merger agreement entered into by Lantheus Holdings and Progenics on February 20, 2020, (as it may be further amended from time to time, the “merger agreement”).

If the merger is completed, Progenics stockholders immediately prior to the completion of the merger will be entitled to receive for each share of Progenics common stock held by them (i) 0.31 of a share of Lantheus Holdings common stock and (ii) one contingent value right representing the right to receive such stockholders pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyLTM (18F-DCFPyL), Progenics prostate-specific membrane antigen targeted imaging agent designed to visualize prostate cancer currently in late stage clinical development, in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively, subject to and in accordance with the terms of the Contingent Value Rights Agreement, including the aggregate payment cap specified therein, as described in more detail in the accompanying joint proxy statement/prospectus under the heading The Merger AgreementMerger Consideration. The exchange ratio is fixed and will not be adjusted to reflect stock price changes prior to the completion of the merger. Based on the closing price of shares of Lantheus Holdings common stock on March 18, 2020, the most recent trading day prior to the date of the accompanying joint proxy statement/prospectus for which this information was available, the stock consideration represented approximately $2.82 in value per share of Progenics common stock. The value of the stock consideration to be received by Progenics stockholders will fluctuate with changes in the price of the shares of Lantheus Holdings common stock. We urge you to obtain current market quotations for shares of Lantheus Holdings common stock and shares of Progenics common stock. Shares of Lantheus Holdings common stock are traded on the Nasdaq Global Market under the symbol “LNTH” and shares of Progenics common stock are traded on the Nasdaq Stock Market under the symbol “PGNX.”

Each of Lantheus Holdings and Progenics will hold a special meeting of its stockholders in connection with the merger agreement.

The Lantheus Holdings special meeting of stockholders will be held at the principal executive offices of Lantheus Holdings, which are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, on April 28, 2020, at 11:15 a.m., Eastern Time. At the Lantheus Holdings special meeting, Lantheus Holdings stockholders will be asked to vote on (i) a proposal to approve the issuance of shares of Lantheus Holdings common stock in the merger and (ii) a proposal to approve the adjournment from time to time of the Lantheus Holdings special meeting if necessary to solicit additional proxies if there are not sufficient votes at the time of the Lantheus Holdings special meeting, or any adjournment or postponement thereof, to approve the issuance of shares of Lantheus Holdings common stock in the merger. Lantheus Holdings board of directors determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of shares of Lantheus Holdings common stock in the merger, are advisable, fair to and in the best interests of Lantheus Holdings and its stockholders and unanimously recommends that Lantheus Holdings stockholders vote “FOR” each proposal.

The Progenics special meeting of stockholders will be held at the principal executive offices of Progenics, which are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007, on April 28, 2020, at 10:15 a.m., Eastern Time. At the Progenics special meeting, Progenics stockholders will be asked to vote on (i) a proposal to adopt the merger agreement, (ii) a proposal to approve the adjournment from time to time of the Progenics special meeting if necessary to solicit additional proxies if there are not sufficient votes to adopt the


Table of Contents

merger agreement at the time of the Progenics special meeting, or any adjournment or postponement thereof, and (iii) a proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger. The Progenics board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair to and in the best interests of Progenics and its stockholders and unanimously recommends that Progenics stockholders vote FOR each proposal.

Lantheus Holdings expects to issue up to approximately 26,844,956 shares of its common stock to Progenics stockholders in the merger. In addition, shares of Lantheus Holdings common stock may be issued from time to time following the effective time of the merger to holders of options to purchase Progenics common stock on the terms set forth in the merger agreement. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of the accompanying joint proxy statement/prospectus for a more detailed explanation. Based on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding as of March 18, 2020, Lantheus Holdings and Progenics estimate that, immediately after the completion of the merger, Lantheus Holdings stockholders will own approximately 60% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding) and former Progenics stockholders will own approximately 40% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding).

The accompanying joint proxy statement/prospectus provides important information regarding the Lantheus Holdings and Progenics special meetings and a detailed description of the merger agreement, the merger, the issuance of shares of Lantheus Holdings common stock in the merger, the adjournment proposals and the proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger. We urge you to read carefully and in its entirety the accompanying joint proxy statement/prospectus (including the annexes and any documents incorporated by reference into the accompanying joint proxy statement/prospectus). Please pay particular attention to the section entitled Risk Factors beginning on page 41 of the accompanying joint proxy statement/prospectus. You can also obtain information about Lantheus Holdings and Progenics from documents that Lantheus Holdings and Progenics previously have filed with the U.S. Securities and Exchange Commission.

For a discussion of the material U.S. federal income tax consequences of the merger, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of the accompanying joint proxy statement/prospectus.

We hope to see you at the applicable special meeting and look forward to the successful completion of the merger.

Your vote is very important, regardless of the number of shares you own. We cannot complete the merger and the merger consideration will not be paid unless (i) Lantheus Holdings stockholders approve the issuance of shares of Lantheus Holdings common stock in the merger and (ii) Progenics stockholders adopt the merger agreement. Whether or not you plan to attend your company’s special meeting of stockholders, please submit your proxy as soon as possible to make sure your shares are represented at that meeting.

 

Sincerely,   Sincerely,

LOGO

 

 

Brian Markison

Chairman of the Board of Directors of Lantheus Holdings

 

LOGO

 

Ann MacDougall

Interim Chair of the Board of Directors of Progenics

Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under the accompanying joint proxy statement/prospectus or determined that the accompanying joint proxy statement/prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

The accompanying joint proxy statement/prospectus is dated March 19, 2020 and is first being mailed to Lantheus Holdings stockholders on or about March 19, 2020 and Progenics stockholders on or about March 19, 2020.


Table of Contents

 

LOGO

Progenics Pharmaceuticals, Inc.

One World Trade Center, 47th Floor, Suite J

New York, New York 10007

(646) 975-2500

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS OF

PROGENICS PHARMACEUTICALS, INC.

TO BE HELD ON APRIL 28, 2020

AT 10:15 a.m., EASTERN TIME

To the Stockholders of Progenics Pharmaceuticals, Inc.:

NOTICE IS HEREBY GIVEN that a special meeting of stockholders of Progenics Pharmaceuticals, Inc., a Delaware corporation, which is referred to in this notice as Progenics, will be held at the principal executive offices of Progenics, which are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007, on April 28, 2020, at 10:15 a.m., Eastern Time, for the following purposes:

 

1.

to consider and vote on a proposal to adopt that certain Amended and Restated Agreement and Plan of Merger, dated as of February 20, 2020, as it may be further amended from time to time, which is referred to in this notice as the merger agreement, among Lantheus Holdings, Inc., a Delaware corporation, which is referred to in this notice as Lantheus Holdings, Plato Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Lantheus Holdings, and Progenics, pursuant to which Plato Merger Sub, Inc. will be merged with and into Progenics, which is referred to in this notice as the merger, with Progenics surviving the merger as a wholly-owned subsidiary of Lantheus Holdings (a copy of the merger agreement is attached as Annex A to the accompanying joint proxy statement/prospectus), which is referred to in this notice as the merger agreement proposal;

 

2.

to consider and vote on a proposal to approve the adjournment from time to time of the special meeting of stockholders of Progenics, which is referred to in this notice as the Progenics special meeting, if necessary to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the Progenics special meeting or any adjournment or postponement thereof, which is referred to in this notice as the Progenics adjournment proposal; and

 

3.

to consider and vote on a proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger which is referred to in this notice as the Progenics compensation advisory proposal.

The holders of record of shares of Progenics common stock, par value $0.0013 per share, which are referred to in this notice as shares of Progenics common stock, at the close of business on March 18, 2020 are entitled to notice of and to vote at the Progenics special meeting or any adjournment or postponement thereof. Progenics anticipates commencing its solicitation of proxies on or about March 19, 2020.

Only stockholders or their proxy holders may attend the Progenics special meeting. If you are attending the Progenics special meeting in person, you will be required to register as a stockholder or proxy holder and to show valid, government-issued identification before entering Progenics special meeting.

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC.

Adoption of the merger agreement requires the affirmative vote, in person or by proxy, of the holders of a majority of the shares of Progenics common stock outstanding and entitled to vote thereon. If a quorum, as


Table of Contents

defined under Progenics’ by-laws, is not present at the Progenics’ special meeting, approval of the adjournment proposal requires the affirmative vote of holders of a majority of the shares of Progenics common stock present in person or represented by proxy at the Progenics special meeting. If a quorum, as defined under Progenics’ by-laws, is present at the Progenics special meeting, approval of the Progenics adjournment proposal requires the affirmative vote of a majority of the votes cast in person or by proxy at the Progenics special meeting by holders of Progenics common stock. Approval of the proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger requires the affirmative vote of a majority of the votes cast in person or by proxy at the Progenics special meeting by holders of shares of Progenics common stock (assuming a quorum, as defined under Progenics’ by-laws, is present).

Progenics’ board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement (including the merger) are fair to and in the best interests of Progenics and its stockholders and unanimously recommends that Progenics stockholders vote (i) “FOR” the proposal to adopt the merger agreement, (ii) “FOR” the proposal to approve the adjournment from time to time of the Progenics special meeting if necessary to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the Progenics special meeting or any adjournment or postponement thereof and (iii) “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger.

By order of the Board of Directors,

 

LOGO

ANN MACDOUGALL

Interim Chair of the Board of Directors of Progenics

New York, New York

March 19, 2020


Table of Contents

YOUR VOTE IS IMPORTANT!

WHETHER OR NOT YOU EXPECT TO ATTEND THE PROGENICS SPECIAL MEETING IN PERSON, WE URGE YOU TO SUBMIT YOUR PROXY AS PROMPTLY AS POSSIBLE (1) VIA THE INTERNET, (2) BY TELEPHONE OR (3) BY COMPLETING, SIGNING AND DATING THE ENCLOSED PROGENICS PROXY CARD AND RETURNING IT IN THE POSTAGE-PAID ENVELOPE PROVIDED. IF YOU ATTEND THE PROGENICS SPECIAL MEETING IN PERSON AND WISH TO VOTE YOUR SHARES AT THE PROGENICS SPECIAL MEETING, YOU MAY DO SO AT ANY TIME PRIOR TO THE CLOSING OF THE POLLS AT THE PROGENICS SPECIAL MEETING. You may revoke your proxy or change your vote for shares of Progenics common stock you hold directly in your name by (i) signing another proxy card with a later date and delivering it to MacKenzie Partners, Inc., 1407 Broadway, 27th Floor, New York, New York 10018 or Progenics Pharmaceuticals, Inc., One World Trade Center, 47th Floor, Suite J, New York, New York 10007, before the date of the Progenics special meeting (we recommend you mail your proxy by April 21, 2020 to ensure timely receipt of your proxy), (ii) submitting revised votes over the Internet or by telephone before 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Progenics special meeting, or (iii) attending the Progenics special meeting in person and voting your shares of Progenics common stock at the Progenics special meeting. If your shares of Progenics common stock are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction form furnished to you by bank, broker or other nominee.

Progenics cannot complete the merger and the merger consideration will not be paid unless its stockholders adopt the merger agreement and the other closing conditions specified in the merger agreement are met. Because adoption of the merger agreement requires the affirmative vote of the holders of at least a majority of the shares of Progenics common stock outstanding and entitled to vote thereon, a Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee or any other failure of a Progenics stockholder to vote will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

We urge you to read carefully the accompanying joint proxy statement/prospectus, including all documents incorporated by reference into the accompanying joint proxy statement/prospectus, and its annexes, in their entirety. If you have any questions concerning the merger agreement, the merger, the vote on the merger agreement, the adjournment proposal, the advisory (non-binding) proposal to approve the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger, the Progenics special meeting or the accompanying joint proxy statement/prospectus (or any other information contained therein), would like additional copies of the accompanying joint proxy statement/prospectus or need help voting your shares of Progenics common stock, please contact:

MacKenzie Partners, Inc.

1407 Broadway, 27th Floor

New York, New York 10018

(212) 929-5500 or (800) 322-2885

Email: pgnx@mackenziepartners.com


Table of Contents

REFERENCES TO ADDITIONAL INFORMATION

The accompanying document is the proxy statement of Lantheus Holdings for its special meeting of stockholders, the proxy statement of Progenics for its special meeting of stockholders and the prospectus of Lantheus Holdings for the shares of its common stock to be issued in the merger. The accompanying joint proxy statement/prospectus incorporates by reference important business and financial information about Lantheus Holdings and Progenics from documents that are not included in or delivered with the accompanying joint proxy statement/prospectus. You can obtain the documents that are incorporated by reference into the accompanying joint proxy statement/prospectus (other than certain exhibits or schedules to those documents), without charge, by requesting them in writing or by telephone from Lantheus Holdings or Progenics, respectively, at the following addresses and telephone numbers, or through the U.S. Securities and Exchange Commission website at www.sec.gov:

 

Lantheus Holdings, Inc.

331 Treble Cove Road

North Billerica, Massachusetts 01862

Attention: Investor Relations

Telephone: (978) 671-8842

 

Progenics Pharmaceuticals, Inc.

One World Trade Center, 47th Floor

New York, New York 10007

Attention: Corporate Secretary

Telephone: (646) 975-2500

In addition, if you have questions about the merger or the accompanying joint proxy statement/prospectus, would like additional copies of the accompanying joint proxy statement/prospectus, or need to obtain proxy cards or other information related to the proxy solicitation, please contact Innisfree M&A Incorporated, the proxy solicitor for Lantheus Holdings, toll-free at (877) 750-9497 or (412) 232-3651 for international callers, if you are a Lantheus Holdings stockholder, or MacKenzie Partners, Inc., the proxy solicitor for Progenics, toll-free at (800) 322-2885, collect at (212) 929-5500 or pgnx@mackenziepartners.com, if you are a Progenics stockholder. You will not be charged for any of these documents that you request.

To obtain timely delivery of the documents, you must request them no later than the dates specified in this joint proxy statement/prospectus. If you are a Lantheus Holdings stockholder and would like to request documents from Lantheus Holdings, please contact Innisfree M&A Incorporated by April 21, 2020 in order to receive them before the Lantheus Holdings special meeting. If you are a Progenics stockholder and would like to request documents from Progenics, please contact MacKenzie Partners, Inc. by April 21, 2020 in order to receive them before the Progenics special meeting.

See “Where You Can Find More Information” beginning on page 260 of the accompanying joint proxy statement/prospectus for further information.


Table of Contents

TABLE OF CONTENTS

 

QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETINGS

     1  

About the Merger Agreement and the Merger

     1  

For Lantheus Holdings Stockholders

     6  

For Progenics Stockholders

     11  

For Both Lantheus Holdings Stockholders and Progenics Stockholders

     19  

SUMMARY

     21  

The Companies

     21  

The Merger

     22  

Special Meeting of Stockholders of Lantheus Holdings

     22  

Special Meeting of Stockholders of Progenics

     24  

What Progenics Stockholders Will Receive in the Merger

     26  

Treatment of Progenics Stock Options

     26  

The Bridge Loan Agreement

     27  

Recommendation of the Lantheus Holdings Board of Directors

     28  

Recommendation of the Progenics Board of Directors

     28  

Opinion of Lantheus Holdings’ Financial Advisor

     28  

Opinion of Progenics’ Financial Advisor

     29  

Ownership of Lantheus Holdings Common Stock After the Merger

     29  

Governance Matters Following Completion of the Merger

     30  

Interests of Progenics’ Directors and Executive Officers in the Merger

     30  

Listing of Lantheus Holdings Common Stock; Delisting and Deregistration of Shares of Progenics Common Stock

     31  

Appraisal or Dissenters’ Rights Available to Progenics Stockholders

     31  

Completion of the Merger Is Subject to Certain Conditions

     31  

The Merger May Not Be Completed Without the Required Regulatory Approvals

     33  

Lantheus Holdings and Progenics Expect the Merger to be Completed Early in the Second Quarter of 2020

     33  

No Solicitation by Progenics or Lantheus Holdings

     33  

Termination of the Merger Agreement

     35  

Termination Fees and Expenses

     37  

Enforcement

     38  

Material U.S. Federal Income Tax Consequences

     38  

Accounting Treatment

     39  

Rights of Progenics Stockholders Will Change as a Result of the Merger

     39  

Litigation Relating to the Merger

     39  

Risk Factors

     40  

RISK FACTORS

     41  

Risks Related to the Merger

     41  

Risks Related to the CVRs

     49  

Risks Related to the Combined Company After Completion of the Merger

     50  

Risks Related to Lantheus Holdings and Progenics

     52  

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF LANTHEUS HOLDINGS

     54  

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF PROGENICS

     55  

COMPARATIVE HISTORICAL AND UNAUDITED PRO FORMA COMBINED PER SHARE DATA

     57  

CERTAIN UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

     59  
NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS      63  

 

(i)


Table of Contents

COMPARATIVE PER SHARE MARKET PRICE AND DIVIDEND INFORMATION

     72  

Market Prices

     72  

Dividends

     73  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     74  

TRADEMARKS

     76  

THE COMPANIES

     77  

Lantheus Holdings

     77  

Progenics

     77  

Plato Merger Sub, Inc.

     78  

SPECIAL MEETING OF STOCKHOLDERS OF LANTHEUS HOLDINGS

     79  

Date, Time and Location

     79  

Purpose

     79  

Recommendation of the Lantheus Holdings Board of Directors

     79  

Lantheus Holdings Record Date; Outstanding Shares; Stockholders Entitled to Vote

     80  

Quorum

     80  

Required Vote

     80  

Stock Ownership of and Voting by Lantheus Holdings Directors and Executive Officers

     81  

Voting of Shares

     81  

Revocability of Proxies; Changing Your Vote

     82  

Solicitation of Proxies; Expenses of Solicitation

     83  

Householding

     83  

Adjournment

     84  

Other Information

     84  

Assistance

     84  

SPECIAL MEETING OF STOCKHOLDERS OF PROGENICS

     85  

Date, Time and Location

     85  

Purpose

     85  

Recommendation of the Progenics Board of Directors

     85  

Progenics Record Date; Outstanding Shares; Stockholders Entitled to Vote

     86  

Quorum

     86  

Required Vote

     86  

Stock Ownership of and Voting by Progenics Directors and Executive Officers

     87  

Voting of Shares

     87  

Revocability of Proxies; Changing Your Vote

     88  

Solicitation of Proxies; Expenses of Solicitation

     89  

Householding

     89  

Adjournment

     90  

Other Information

     90  

Assistance

     90  

LANTHEUS HOLDINGS PROPOSAL I: APPROVAL OF THE STOCK ISSUANCE AND PROGENICS PROPOSAL I: ADOPTION OF THE MERGER AGREEMENT

     91  

General

     91  

Background of the Merger and Certain Other Developments

     91  

Certain Relationships between Lantheus Holdings and Progenics

     127  

Lantheus Holdings’ Reasons for the Merger; Recommendation of the Lantheus Holdings Board of Directors that Lantheus Holdings Stockholders Approve the Stock Issuance

     127  

Progenics’ Reasons for the Merger; Recommendation of the Progenics Board of Directors that Progenics Stockholders Adopt the Merger Agreement

     136  

Opinion of Lantheus Holdings’ Financial Advisor

     140  

Opinion of Progenics’ Financial Advisor

     148  

Certain Unaudited Prospective Financial Information

     157  

 

(ii)


Table of Contents

Regulatory Approvals Required for the Merger

     164  

Appraisal or Dissenters’ Rights for Progenics Stockholders

     166  

Material U.S. Federal Income Tax Consequences

     170  

Accounting Treatment

     176  

Listing of Lantheus Holdings Common Stock; Delisting and Deregistration of Shares of Progenics Common Stock

     177  

Litigation Relating to the Merger

     177  

THE MERGER AGREEMENT

     179  

Explanatory Note Regarding the Merger Agreement and the Summary of the Merger Agreement: Representations, Warranties and Covenants in the Merger Agreement Are Not Intended to Function or Be Relied on as Public Disclosures

     179  

Original Merger Agreement

     179  

Structure of the Merger

     179  

Directors and Officers of the Surviving Corporation

     180  

Closing and Effectiveness of the Merger

     180  

Merger Consideration

     180  

No Fractional Shares of Lantheus Holdings

     181  

Appraisal Rights

     181  

Procedures for Exchanging Progenics Common Stock for Lantheus Holdings Common Stock

     181  

Dividends and Distributions with respect to Unexchanged Shares

     182  

Lost, Stolen or Destroyed Certificates

     182  

Treatment of Progenics Stock Options

     183  

Listing of Lantheus Holdings Common Stock

     183  

Governance Matters Following Completion of the Merger

     184  

Conditions to Completion of the Merger

     184  

Representations and Warranties

     186  

Definition of “Material Adverse Effect”

     187  

Conduct of Business Pending the Merger

     188  

Obligations to Recommend the Adoption of the Merger Agreement and the Approval of the Stock Issuance

     193  

No Solicitation

     193  

Reasonable Best Efforts Covenant

     197  

Obligations to Call Stockholders’ Meetings

     198  

Proxy Statement and Registration Statement Covenant

     199  

Indemnification and Insurance

     200  

Employee Matters

     201  

CVR Agreement

     202  

Nonregistrable CVRs

     202  

Certain Other Covenants and Agreements

     203  

Termination of the Merger Agreement

     205  

Termination Fees and Expenses

     207  

Other Expenses

     208  

Enforcement

     208  

Third-Party Beneficiaries

     208  

Amendments; Waivers

     209  

THE BRIDGE LOAN AGREEMENT

     210  

INTERESTS OF PROGENICS’ DIRECTORS AND EXECUTIVE OFFICERS IN THE MERGER

     211  

Appointment of Two Progenics Directors to the Lantheus Holdings Board

     211  

Resignation of Patrick Fabbio; Consulting Services Agreement

     211  

Treatment of Progenics Stock Options

     211  

Retention Payment Agreements

     213  

 

(iii)


Table of Contents

Severance Benefits

     214  

Indemnification and Insurance

     214  

Quantification of Potential Payments and Benefits to Progenics’ Named Executive Officers in Connection with the Merger

     214  
LANTHEUS HOLDINGS PROPOSAL II: ADJOURNMENT OF THE LANTHEUS HOLDINGS SPECIAL MEETING      216  

PROGENICS PROPOSAL II: ADJOURNMENT OF THE PROGENICS SPECIAL MEETING

     217  
PROGENICS PROPOSAL III: ADVISORY VOTE ON MERGER-RELATED EXECUTIVE COMPENSATION ARRANGEMENTS      218  

DESCRIPTION OF LANTHEUS HOLDINGS CAPITAL STOCK

     219  

Lantheus Holdings Common Stock

     219  

Lantheus Holdings Preferred Stock

     220  

Antitakeover Provisions

     221  

DESCRIPTION OF THE CVRS

     225  

Characteristics of CVRs

     225  

Net Sales Payment

     226  

Withholding

     227  

Independent Accountant Review

     227  

Diligent Efforts

     227  

Consolidation, Merger, Sale or Conveyance

     227  

Amendments

     228  
STOCK OWNERSHIP OF AND VOTING BY LANTHEUS HOLDINGS DIRECTORS AND EXECUTIVE OFFICERS AND CERTAIN STOCKHOLDERS      230  
STOCK OWNERSHIP OF AND VOTING BY PROGENICS DIRECTORS AND EXECUTIVE OFFICERS AND CERTAIN STOCKHOLDERS      232  

COMPARISON OF STOCKHOLDER RIGHTS

     235  

LEGAL MATTERS

     256  

EXPERTS

     257  

FUTURE STOCKHOLDER PROPOSALS

     258  

Lantheus Holdings

     258  

Progenics

     258  

WHERE YOU CAN FIND MORE INFORMATION

     260  

ANNEX A—Amended and Restated Agreement and Plan of Merger

     A-1  

ANNEX B—Form of Contingent Value Rights Agreement

     B-1  

ANNEX C—Opinion of SVB Leerink LLC

     C-1  

ANNEX D—Opinion of BofA Securities, Inc.

     D-1  

ANNEX E—Section 262 of the Delaware General Corporation Law

     E-1  

 

(iv)


Table of Contents

QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETINGS

The following are some questions that you, as a stockholder of Lantheus Holdings, Inc., which is referred to in this joint proxy statement/prospectus as Lantheus Holdings, or a stockholder of Progenics Pharmaceuticals, Inc., which is referred to in this joint proxy statement/prospectus as Progenics, may have regarding the merger agreement, the merger, the stock issuance, the Lantheus Holdings adjournment proposal, the Progenics adjournment proposal, the Progenics compensation advisory proposal and the special meetings as well as brief answers to those questions. You are urged to read carefully this joint proxy statement/prospectus, including all documents incorporated by reference into this joint proxy statement/prospectus, and its annexes, in their entirety because this section may not provide all of the information that is important to you with respect to the merger agreement, the merger, the stock issuance, the Lantheus Holdings adjournment proposal, the Progenics adjournment proposal, the Progenics compensation advisory proposal and the special meetings. Additional important information is contained in the annexes to, and the documents incorporated by reference into, this joint proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

About the Merger Agreement and the Merger

 

Q:

Why am I receiving this document and why am I being asked to vote on the merger agreement?

 

A:

Lantheus Holdings and Progenics have agreed to a merger, which is referred to in this joint proxy statement/prospectus as the merger, pursuant to which Progenics will become a wholly-owned subsidiary of Lantheus Holdings and will no longer be a publicly traded corporation. Following the merger, Progenics common stock will be delisted from the Nasdaq Stock Market and deregistered under the Securities Exchange Act of 1934, as amended, which is referred to in this joint proxy statement/prospectus as the Exchange Act, and Progenics will no longer be required to file periodic reports with the U.S. Securities and Exchange Commission, which is referred to in this joint proxy statement/prospectus as the SEC. In order to complete the merger, holders of Lantheus Holdings common stock, who are referred to in this joint proxy statement/prospectus as Lantheus Holdings stockholders, must vote to approve the issuance of shares of Lantheus Holdings common stock to Progenics stockholders in the merger, which issuance is referred to in this joint proxy statement/prospectus as the stock issuance, and Progenics stockholders must vote to adopt the Amended and Restated Agreement and Plan of Merger, dated as of February 20, 2020, among Lantheus Holdings, Progenics and Plato Merger Sub, Inc., a wholly-owned subsidiary of Lantheus Holdings, which is referred to in this joint proxy statement/prospectus as Merger Sub. The Amended and Restated Agreement and Plan of Merger, as it may be further amended from time to time, is referred to in this joint proxy statement/prospectus as the merger agreement.

Lantheus Holdings is holding a special meeting of stockholders, which is referred to in this joint proxy statement/prospectus as the Lantheus Holdings special meeting, in order to obtain the stockholder approval necessary to approve the stock issuance, which is referred to in this joint proxy statement/prospectus as the stock issuance proposal. Approval of the stock issuance proposal requires the affirmative vote of at least a majority of the votes cast by holders of outstanding shares of Lantheus Holdings common stock, at a duly called and held meeting of Lantheus Holdings stockholders at which a quorum is present. A majority of the votes cast means that the number of votes cast “FOR” the stock issuance proposal must exceed the number of votes cast “AGAINST.” Lantheus Holdings stockholders will also be asked to approve the adjournment from time to time of the Lantheus Holdings special meeting if necessary to solicit additional proxies if there are not sufficient votes at the time of the Lantheus Holdings special meeting, or any adjournment or postponement thereof, to approve the stock issuance, which is referred to in this joint proxy statement/prospectus as the Lantheus Holdings adjournment proposal. Approval of the Lantheus Holdings adjournment proposal requires the affirmative vote of the holders of a majority of the shares present in person or represented by proxy at the Lantheus Holdings special meeting and entitled to vote thereat (assuming a quorum is present). In the absence of a quorum, the Lantheus Holdings special meeting may be adjourned by the Chairperson of the meeting. For purposes of this

 

1


Table of Contents

proposal, “shares of Lantheus Holdings common stock present or represented by proxy” consist of shares voted “FOR” or “AGAINST” as well as elections to abstain from voting on the proposal. It is important that Lantheus Holdings stockholders vote their shares of Lantheus Holdings common stock on each of these matters, regardless of the number of shares owned.

Progenics is holding a special meeting of stockholders, which is referred to in this joint proxy statement/prospectus as the Progenics special meeting, in order to obtain the stockholder approval necessary to adopt the merger agreement. Adoption of the merger agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Progenics common stock entitled to vote thereon. A Progenics stockholder’s abstention from voting or failure to vote will have the same effect as a vote “AGAINST” the proposal. Progenics stockholders will also be asked to approve the adjournment from time to time of the Progenics special meeting if necessary to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the Progenics special meeting, or any adjournment or postponement thereof, which is referred to in this joint proxy statement/prospectus as the Progenics adjournment proposal, and to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers, whom are referred to in this joint proxy statement/prospectus as the named executive officers, in connection with the merger, which proposal is referred to in this joint proxy statement/prospectus as the Progenics compensation advisory proposal. The vote required to approve the Progenics adjournment proposal depends on whether or not a quorum is present at the Progenics special meeting. If a quorum is not present at the Progenics special meeting, approval of the Progenics adjournment proposal requires the affirmative vote of holders of a majority of the shares of Progenics common stock present in person or represented by proxy at the Progenics special meeting. For purposes of this proposal, if a quorum is not present, “shares of Progenics common stock present in person or represented by proxy” consist of votes “FOR” or “AGAINST” as well as elections to abstain from voting on the proposal. If a quorum is present at the Progenics special meeting, approval of the Progenics adjournment proposal requires the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. For purposes of this proposal, if a quorum is present, a “majority of the votes cast” means the number of votes cast “FOR” the proposal must exceed the number of votes cast “AGAINST” the proposal. Approval of the Progenics compensation advisory proposal requires the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. For purposes of this proposal, a majority of the votes cast means that the number of votes cast “FOR” the proposal must exceed the number of votes cast “AGAINST.” It is important that Progenics stockholders vote their shares of Progenics common stock on each of these matters, regardless of the number of shares owned.

This document is being delivered to you as both a joint proxy statement of Lantheus Holdings and Progenics and a prospectus of Lantheus Holdings in connection with the merger and the stock issuance. This document is the proxy statement by which the Lantheus Holdings board of directors, which is referred to in this joint proxy statement/prospectus as the Lantheus Holdings Board, is soliciting proxies from Lantheus Holdings stockholders to vote at the Lantheus Holdings special meeting, or at any adjournment or postponement thereof, on the approval of the stock issuance proposal and the approval of the Lantheus Holdings adjournment proposal. In addition, this document is the prospectus of Lantheus Holdings pursuant to which Lantheus Holdings will issue shares of Lantheus Holdings common stock to Progenics stockholders as part of the merger consideration, as described under “The Merger Agreement—Merger Consideration” beginning on page 180 of this joint proxy statement/prospectus. This document is also the proxy statement by which the Progenics board of directors, which is referred to in this joint proxy statement/prospectus as the Progenics Board, is soliciting proxies from Progenics stockholders to vote at the Progenics special meeting, or at any adjournment or postponement thereof, on the merger agreement proposal, the Progenics adjournment proposal and the Progenics compensation advisory proposal.

 

Q:

Is my vote important?

 

A:

Yes, your vote is very important. If you do not submit a proxy or vote in person at the meeting, it will be more difficult for us to obtain the necessary quorum to hold the meeting. In addition, for Progenics

 

2


Table of Contents
  stockholders, an abstention from voting or a failure to vote will have the same effect as a vote “AGAINST” the merger agreement proposal. If you hold your shares of Progenics common stock in “street name” through a broker, bank or other nominee and you do not give voting instructions to that broker, bank or other nominee, that broker, bank or other nominee will not be able to vote your shares on the merger agreement proposal, and your failure to give those instructions will have the same effect as a vote “AGAINST” the merger agreement proposal. A Lantheus Holdings stockholder’s abstention from voting on the stock issuance proposal or the failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee will have no effect on the approval of the stock issuance proposal. The Progenics Board unanimously recommends that Progenics stockholders vote “FOR” the merger agreement proposal, and the Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote “FOR” the stock issuance proposal.

 

Q:

What will happen in the merger?

 

A:

In the merger, Merger Sub will be merged with and into Progenics. Progenics will be the surviving corporation in the merger, which is referred to in this joint proxy statement/prospectus as the surviving corporation or Progenics, and the surviving corporation will be a wholly-owned subsidiary of Lantheus Holdings following completion of the merger. Progenics will no longer be a publicly traded corporation, its shares will be delisted from the Nasdaq Stock Market and deregistered under the Exchange Act, and it will no longer be required to file periodic reports with the SEC.

 

Q:

What will Progenics stockholders receive in the merger?

 

A:

If the merger is completed, each share of Progenics common stock (other than (A) shares of Progenics common stock owned by Lantheus Holdings, Progenics or any of their respective wholly-owned subsidiaries, which are collectively referred to as excluded shares in this joint proxy statement/prospectus, and (B) shares of Progenics common stock held by stockholders who have properly made and not withdrawn a demand for appraisal rights under the Delaware General Corporation Law, which are collectively referred to as dissenting shares in this joint proxy statement/prospectus) will automatically be cancelled and converted into the right to receive (i) 0.31, which is referred to in this joint proxy statement/prospectus as the exchange ratio, of a share of Lantheus Holdings common stock, which is referred to in this joint proxy statement/prospectus as the stock consideration, and (ii) one contingent value right, which is referred to in this joint proxy statement/prospectus as a CVR, and together with the stock consideration, is referred to in this joint proxy statement/prospectus as the merger consideration. Each CVR represents the right to receive such stockholder’s pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyLTM (18F-DCFPyL), Progenics’ prostate-specific membrane antigen targeted imaging agent designed to visualize prostate cancer currently in late stage clinical development, which is referred to in this joint proxy statement/prospectus as PyL, in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively, subject to and in accordance with the terms of the contingent value rights agreement, which is referred to in this joint proxy statement/prospectus as the CVR agreement, including the aggregate payment cap specified therein.

 

Q:

What is the value of the stock consideration?

 

A:

In the merger, each Progenics stockholder will receive, for each share of Progenics common stock they own as of immediately prior to the completion of the merger (other than excluded shares and dissenting shares) the merger consideration as described under “The Merger Agreement—Merger Consideration” beginning on page 180 of this joint proxy statement/prospectus.

Based on the closing price of shares of Lantheus Holdings common stock on the Nasdaq Global Market on February 19, 2020, the last trading day prior to announcement of the amended transaction between Lantheus Holdings and Progenics, the stock consideration represented approximately $5.12 in value for each share of Progenics common stock. Based on the closing price of shares of Lantheus Holdings common stock on the

 

3


Table of Contents

Nasdaq Global Market on March 18, 2020, the most recent trading day prior to the date of this joint proxy statement/prospectus for which this information was available, the stock consideration represented approximately $2.82 in value for each share of Progenics common stock.

Because Lantheus Holdings will issue 0.31 of a share of Lantheus Holdings common stock in exchange for each share of Progenics common stock, the value of the stock consideration will depend on the market price of shares of Lantheus Holdings common stock at the time the merger is completed. The market price of shares of Lantheus Holdings common stock when Progenics stockholders receive those shares after the merger is completed will not be known at the time of the special meetings and could be greater than, less than or the same as the market price of shares of Lantheus Holdings common stock on February 19, 2020, on the date of this joint proxy statement/prospectus or at the time of the special meetings or any adjournment or postponement thereof. Because the exchange ratio is fixed and the market price of shares of Lantheus Holdings common stock has fluctuated and will continue to fluctuate, Progenics stockholders cannot be sure of the value of the stock consideration they will receive in the merger. See “Risk Factors—Risks Related to the Merger.”

 

Q:

What will be the respective ownership percentages of Lantheus Holdings stockholders and Progenics stockholders and Lantheus Holdings stockholders in the combined company immediately after the completion of the merger?

 

A:

Based on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding as of March 18, 2020, Lantheus Holdings and Progenics estimate that, immediately after the completion of the merger, Lantheus Holdings stockholders will own approximately 60% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding) and former Progenics stockholders will own approximately 40% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding). The exact equity stake of Lantheus Holdings stockholders and Progenics stockholders in the combined company immediately following the completion of the merger will depend on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding immediately prior to the merger.

 

Q:

What are the CVRs?

 

A:

The CVRs are non-transferable contingent value rights that will be issued as part of the merger consideration to Progenics stockholders and holders of in-the-money Progenics stock options. Each CVR will entitle its holder to receive his, her or its pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyL in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively. The CVRs will be non-transferable and, accordingly, will not be listed on any securities exchange. The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Lantheus Holdings, Merger Sub, Progenics or any of their affiliates.

For a more detailed description of the CVRs, see the section entitled “Description of the CVRs” beginning on page 225 of this joint proxy statement/prospectus. Additionally, a form of the CVR agreement is attached as Annex B to this joint proxy statement/prospectus. Progenics stockholders are encouraged to read the entire form of CVR agreement carefully because it is the principal document governing the CVRs.

 

Q:

Is it possible that I will not receive any payment under the CVRs or that any payments may be capped?

 

A:

Yes. There can be no assurance that the net sales generated by PyL in calendar years 2022 and 2023 will be in excess of $100 million and $150 million, respectively, and that the resulting payments will be required of Lantheus Holdings. The amounts to be received in connection with the CVRs, and the timing of any payments of any such amounts, are contingent solely upon the achievement of the foregoing milestones within the specified time periods and other terms and conditions of the CVR agreement, which may or may

 

4


Table of Contents
  not occur and may be outside the control of Lantheus Holdings or Progenics. There may be no payments ultimately made in respect of the CVRs, and the CVRs may ultimately expire without value.

In addition, payments under the CVRs are subject to an aggregate payment cap. The sum of (i) the aggregate amount of payments paid or payable pursuant to the CVR agreement (including any interest on such amounts paid or payable to the rights agent or any CVR holder) and (ii) the amount of any other cash or the fair market value of any property (other than Lantheus Holdings common stock or the CVRs) paid or payable to Progenics stockholders as consideration pursuant to the merger agreement will not (A) exceed 19.9% of the aggregate amount of consideration paid or payable to Progenics stockholders in the merger or (B) constitute an amount the payment of which, in the opinion of nationally recognized tax counsel, would more likely than not prevent the merger from satisfying the requirement of Section 368(a)(2)(E)(ii) of the U.S. Internal Revenue Code of 1986, as amended, which is referred to in this joint proxy statement/prospectus as the Code. Such amount is referred to in this joint proxy statement/prospectus as the CVR cap.

 

Q:

Is interest payable with respect to the CVRs?

 

A:

Generally, no. Except in the limited circumstance where an independent accountant, upon review in accordance with the CVR agreement, concludes that the CVR holders are entitled to a payment in an amount greater than the CVR payment made by Lantheus Holdings (in which case, Lantheus Holdings is required to pay such shortfall together with interest), no interest will accrue on the CVRs.

 

Q:

Is the CVR payment secured or guaranteed?

 

A:

No. The CVR payment is neither secured nor guaranteed. The CVR payment, if any becomes due, is an unsecured general obligation of Lantheus Holdings and is not guaranteed by Lantheus Holdings or any of its affiliates.

 

Q:

Can holders of the CVRs transfer the CVRs?

 

A:

Generally, no. The CVRs may not be sold, assigned, transferred, pledged, encumbered or disposed of in any other manner, in whole or in part, other than in certain limited circumstances.

 

Q:

Will the stock consideration I receive in the merger increase if the results of operations of Progenics improve or if the market price of Progenics common stock increases prior to closing?

 

A:

No. The stock consideration payable for each share of Progenics common stock at closing is fixed at 0.31 of a share of common stock of Lantheus Holdings, and the payment received at closing will not change regardless of the results of operations of Progenics or the price of publicly traded common stock of Progenics. Furthermore, as described above, the value of the stock consideration may decrease if the market price of Lantheus Holdings common stock is lower at the time the merger is completed than the market price as of the date of this joint proxy statement/prospectus.

 

Q:

What happens if the merger is not completed?

 

A:

If the merger agreement is not adopted by Progenics stockholders, the stock issuance is not approved by Lantheus Holdings stockholders or if the merger is not completed for any other reason, Progenics stockholders will not receive any payment for their shares of Progenics common stock in connection with the merger. Instead, Progenics will remain an independent public company, shares of its common stock will continue to be listed and traded on the Nasdaq Stock Market and registered under the Exchange Act and Progenics will continue to file periodic reports with the SEC. If the merger agreement is terminated under specified circumstances, Progenics may be required to pay Lantheus Holdings a termination fee of $18,340,000, which is referred to in this joint proxy statement/prospectus as the Progenics termination fee, or reimburse Lantheus Holdings for up to $5,240,000 of its reasonable and out-of-pocket costs and expenses

 

5


Table of Contents
  incurred in connection with the merger agreement and the merger, which reimbursement is referred to in this joint proxy statement/prospectus as the Lantheus Holdings expense reimbursement. In addition, if the merger agreement is terminated and, prior to such termination, Progenics has willfully and materially breached the merger agreement, Progenics will be liable for monetary damages equal to $18,340,000, which is referred to in this joint proxy statement/prospectus as the willful breach damages payment. If the merger agreement is terminated under certain circumstances, Lantheus Holdings may be required to pay Progenics a termination fee of $18,340,000, which is referred to in this joint proxy statement/prospectus as the Lantheus Holdings termination fee. See “The Merger Agreement—Termination Fees and Expenses” beginning on page 207 of this joint proxy statement/prospectus and “Risk Factors—Risks Related to the Merger—The merger is subject to conditions, some or all of which may not be satisfied, or completed on a timely basis, if at all. Failure to complete the merger could have material adverse effects on Lantheus Holdings’ and Progenics’ businesses.”

For Lantheus Holdings Stockholders

 

Q:

What are Lantheus Holdings stockholders being asked to consider and vote on?

 

A:

Lantheus Holdings stockholders are being asked to consider and vote on the following two proposals:

 

   

the stock issuance proposal; and

 

   

the Lantheus Holdings adjournment proposal.

The approval of the stock issuance proposal by Lantheus Holdings stockholders is a condition to the obligations of Progenics and Lantheus Holdings to complete the merger. The approval of the Lantheus Holdings adjournment proposal is not a condition to the obligations of Progenics or Lantheus Holdings to complete the merger.

 

Q:

Does the Lantheus Holdings Board recommend that Lantheus Holdings stockholders approve the stock issuance proposal?

 

A:

Yes. The Lantheus Holdings Board unanimously determined that the stock issuance was advisable, fair to and in the best interests of Lantheus Holdings and its stockholders and unanimously recommends that Lantheus Holdings stockholders vote “FOR” the stock issuance proposal. See “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Lantheus Holdings’ Reasons for the Merger; Recommendation of the Lantheus Holdings Board of Directors that Lantheus Holdings Stockholders Approve the Stock Issuance” beginning on page 127 of this joint proxy statement/prospectus.

 

Q:

Does the Lantheus Holdings Board recommend that Lantheus Holdings stockholders approve the Lantheus Holdings adjournment proposal?

 

A:

Yes. The Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote “FOR” the Lantheus Holdings adjournment proposal. See “Lantheus Holdings Proposal II: Adjournment of the Lantheus Holdings Special Meeting” beginning on page 216 of this joint proxy statement/prospectus.

 

Q:

What will happen to my shares of Lantheus Holdings common stock?

 

A:

Nothing. You will continue to own the same shares of Lantheus Holdings common stock that you owned prior to the effective time of the merger. As a result of the stock issuance, however, the overall ownership percentage of the current Lantheus Holdings stockholders in the combined company will be diluted.

 

6


Table of Contents
Q:

What Lantheus Holdings stockholder vote is required for the approval of each proposal at the Lantheus Holdings special meeting?

 

A:

The following are the vote requirements for the proposals at the Lantheus Holdings special meeting:

 

   

Approval of the Stock Issuance Proposal: The affirmative vote of at least a majority of the votes cast by holders of outstanding shares of Lantheus Holdings common stock at a duly called and held meeting of Lantheus Holdings stockholders at which a quorum is present. A Lantheus Holdings stockholder’s abstention from voting will have no effect on the approval of this proposal. The failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of this proposal except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

 

   

Approval of the Lantheus Holdings Adjournment Proposal (if necessary): The affirmative vote of the holders of a majority of the shares of Lantheus Holdings common stock present in person or represented by proxy at the Lantheus Holdings special meeting and entitled to vote thereat (assuming a quorum, as defined under Lantheus Holdings’ by-laws, is present). A Lantheus Holdings stockholder’s abstention from voting on the Lantheus Holdings adjournment proposal will have the same effect as a vote “AGAINST” the approval of the proposal. The failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of this proposal except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum. In the absence of a quorum, the Lantheus Holdings special meeting may be adjourned by the Chairperson of the meeting.

 

Q:

What constitutes a quorum for the Lantheus Holdings special meeting?

 

A:

The holders of a majority of the outstanding shares of Lantheus Holdings common stock entitled to vote being present in person or represented by proxy constitutes a quorum for the Lantheus Holdings special meeting. Shares of Lantheus Holdings common stock whose holders elect to abstain from voting will be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum. Shares of Lantheus Holdings common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to its broker, bank or other nominee will not be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum.

 

Q:

Who is entitled to vote at the Lantheus Holdings special meeting?

 

A:

All holders of shares of Lantheus Holdings common stock who held shares at the record date for the Lantheus Holdings special meeting (the close of business on March 18, 2020) are entitled to receive notice of, and to vote at, the Lantheus Holdings special meeting. As of the close of business on the record date, there were 39,716,519 shares of Lantheus Holdings common stock outstanding. Each holder of shares of Lantheus Holdings common stock is entitled to one vote for each share of Lantheus Holdings common stock owned at the record date.

 

Q:

When and where is the Lantheus Holdings special meeting?

 

A:

The Lantheus Holdings special meeting will be held at the principal executive offices of Lantheus Holdings, which are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, on April 28, 2020, at 11:15 a.m., Eastern Time.

 

7


Table of Contents
Q:

What happens if a change to the Lantheus Holdings special meeting is necessary due to exigent circumstances?

 

A:

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this joint proxy statement/prospectus.

 

Q:

How do I vote my shares at the Lantheus Holdings special meeting?

 

A:

Via the Internet or by Telephone

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, you may vote via the Internet by accessing the website shown on your proxy card or by telephone by calling the toll-free number shown on your proxy card. In order to submit a proxy to vote via the Internet or by telephone, you will need the control number on your proxy card (which is unique to each Lantheus Holdings stockholder to ensure all voting instructions are genuine and to prevent duplicate voting). Votes may be submitted via the Internet or by telephone 24 hours a day, seven days a week, and must be received by 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Lantheus Holdings special meeting. Please be aware that if you vote by telephone or over the Internet, you may incur costs such as telephone and Internet access charges for which you will be responsible.

If you hold shares of Lantheus Holdings common stock in “street name,” meaning through a broker, bank or other nominee, you may vote via the Internet or by telephone only if Internet or telephone voting is made available by your broker, bank or other nominee. Please follow the voting instructions provided by your broker, bank or other nominee with these materials.

You may vote via the Internet or by telephone until 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Lantheus Holdings special meeting.

By Mail

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, in order to vote by mail, you may submit a proxy card. You will need to complete, sign and date your proxy card and return it using the postage-paid return envelope provided.

If you hold shares of Lantheus Holdings common stock in “street name,” meaning through a broker, bank or other nominee, in order to provide voting instructions by mail you will need to complete, sign and date the voting instruction form provided by your broker, bank or other nominee with these materials and return it in the postage-paid return envelope provided. Your broker, bank or other nominee must receive your voting instruction form in sufficient time to vote your shares.

We recommend you mail your proxy timely to ensure receipt of your proxy before the date of the special meeting.

In Person

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, you may vote in person at the Lantheus Holdings special meeting. Stockholders of record also may be represented by another person at the Lantheus Holdings special meeting by executing a proper proxy designating that person and having that proper proxy be presented to the inspector of election with the applicable ballot at the Lantheus Holdings special meeting.

 

8


Table of Contents

If you hold shares of Lantheus Holdings common stock in “street name,” meaning through a broker, bank or other nominee, you must obtain a written legal proxy from that broker, bank or other nominee and present it to the judge of election with your ballot to be able to vote in person at the Lantheus Holdings special meeting. To request a legal proxy, please contact your broker, bank or other nominee.

Please carefully consider the information contained in this joint proxy statement/prospectus. Whether or not you plan to attend the Lantheus Holdings special meeting, Lantheus Holdings encourages you to vote via the Internet, by telephone or by mail so that your shares will be voted in accordance with your wishes even if you later decide not to attend the Lantheus Holdings special meeting.

 

Q:

If my shares of Lantheus Holdings common stock are held in “street name,” will my broker, bank or other nominee automatically vote my shares for me?

 

A:

No. Your broker, bank or other nominee will only be permitted to vote your shares of Lantheus Holdings common stock if you instruct your broker, bank or other nominee how to vote. You should follow the procedures provided by your broker, bank or other nominee regarding the voting of your shares of Lantheus Holdings common stock.

In general, in accordance with applicable stock exchange rules, if your shares of Lantheus Holdings common stock are held in “street name” and you do not instruct your broker how to vote your shares, your brokerage firm, in its discretion, may either leave your shares unvoted or vote your shares on routine matters. However, a broker is precluded from exercising its voting discretion with respect to non-routine or “significant” matters, such as the approval of the stock issuance proposal and the approval of the Lantheus Holdings adjournment proposal. None of the proposals at the Lantheus Holdings special meeting are routine matters. As a result, if you hold your shares in “street name” through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the special meeting.

If a beneficial owner of shares of Lantheus Holdings common stock held in “street name” does not give voting instructions to its broker, bank or other nominee, then those shares will not be present in person or represented by proxy at the Lantheus Holdings special meeting. A beneficial owner’s failure to instruct its broker, bank or other nominee how to vote shares of Lantheus Holdings common stock will have no effect on either of the proposals to be considered at the Lantheus Holdings special meeting as described in this joint proxy statement/prospectus, except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

 

Q:

If I submit a proxy, how will my shares covered by the proxy be voted at the Lantheus Holdings special meeting?

 

A:

If you correctly submit your proxy via the Internet, by telephone or by mail, the persons named in your proxy card will vote your shares in the manner you requested.

 

Q:

If I return a blank proxy, how will my shares be voted at the Lantheus Holdings special meeting?

 

A:

If you sign your proxy card and return it without indicating how you would like to vote your shares, your proxy will be voted as the Lantheus Holdings Board unanimously recommends, which is:

 

   

“FOR” the stock issuance proposal; and

 

   

“FOR” the Lantheus Holdings adjournment proposal.

 

Q:

Who may attend the Lantheus Holdings special meeting?

 

A:

Lantheus Holdings stockholders at the record date for the Lantheus Holdings special meeting (the close of business on March 18, 2020), or their proxy holders, their authorized representatives and guests of Lantheus Holdings may attend the Lantheus Holdings special meeting. If you plan to attend the Lantheus Holdings

 

9


Table of Contents
  special meeting, you will need to provide evidence that you are a stockholder as of the close of business on the record date. This can be a copy of your proxy card or a brokerage statement showing your shares as of the close of business on the record date. You should also bring photo identification. If you hold your shares in street name and wish to vote in person at the meeting, you will need to contact the broker, bank or other nominee that holds your shares in order to obtain a legal proxy from that broker, bank or other nominee to present at the special meeting.

 

Q:

Can I revoke my proxy or change my voting instructions for Lantheus Holdings common stock?

 

A:

Yes. You may revoke your proxy or change your vote at any time before the closing of the polls at the Lantheus Holdings special meeting.

If you are a stockholder of record at the record date for the Lantheus Holdings special meeting (the close of business on March 18, 2020), you can revoke your proxy or change your vote by:

 

   

sending a signed notice, which bears a date later than the date of the proxy you want to revoke and which is received prior to the date of the Lantheus Holdings special meeting, stating that you revoke your proxy to 331 Treble Cove Road, North Billerica, Massachusetts 01862, Attention: Investor Relations;

 

   

submitting a valid, later-dated proxy or voting instructions via the Internet or by telephone before 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Lantheus Holdings special meeting, or by mail that is received prior to the Lantheus Holdings special meeting; or

 

   

attending the Lantheus Holdings special meeting (or, if the special meeting is adjourned or postponed, attending the applicable adjourned or postponed meeting) and voting in person, which automatically will cancel any proxy previously given, or revoking your proxy in person, but your attendance alone will not revoke any proxy previously given.

If you hold your shares in “street name” through a broker, bank or other nominee, you must contact your broker, bank or other nominee to change your vote or obtain a written legal proxy to vote your shares if you wish to cast your vote in person at the Lantheus Holdings special meeting.

 

Q:

What happens if I sell my Lantheus Holdings shares after the record date but before the Lantheus Holdings special meeting?

 

A:

The record date for the Lantheus Holdings special meeting (the close of business on March 18, 2020) is earlier than the date of the Lantheus Holdings special meeting. If you sell or otherwise transfer your shares of Lantheus Holdings common stock after the record date but before the date of the Lantheus Holdings special meeting, you will, unless the transferee obtains a proxy from you, retain your right to vote at the Lantheus Holdings special meeting.

 

Q:

Are Lantheus Holdings stockholders entitled to appraisal rights?

 

A:

No. Rights to fair value or appraisal, dissenters’ or similar rights are not available to holders of Lantheus Holdings common stock with respect to the merger.

 

Q:

Who is the inspector of the election for the Lantheus Holdings special meeting?

 

A:

A representative of Mediant Communications, Inc. will serve as the inspector of election for the Lantheus Holdings special meeting.

 

Q:

Will a proxy solicitor be used for the Lantheus Holdings special meeting?

 

A:

Yes. Lantheus Holdings has engaged Innisfree M&A Incorporated to assist in the solicitation of proxies for the Lantheus Holdings special meeting, and Lantheus Holdings has agreed to pay them a fee of $25,000 for services in connection with the Lantheus Holdings special meeting.

 

10


Table of Contents
Q:

Where can I find the voting results of the Lantheus Holdings special meeting?

 

A:

The preliminary voting results will be announced at the Lantheus Holdings special meeting. In addition, within four business days following certification of the final voting results, Lantheus Holdings intends to file the final voting results with the SEC on a Current Report on Form 8-K.

 

Q:

If I am a Lantheus Holdings stockholder, whom should I call with questions?

 

A:

If you have any questions about the merger agreement, the merger, the stock issuance, the stock issuance proposal, the Lantheus Holdings adjournment proposal, the Lantheus Holdings special meeting or this joint proxy statement/prospectus, desire additional copies of this joint proxy statement/prospectus, proxy cards or voting instruction forms or need help voting your shares of Lantheus Holdings common stock, you should contact:

 

LOGO

Innisfree M&A Incorporated

501 Madison Avenue, 20th Floor

New York, New York 10022

Telephone (Toll-Free): (877) 750-9497

International Callers: (412) 232-3651

Banks and brokers may call collect: (212) 750-5833

For Progenics Stockholders

 

Q:

What are Progenics stockholders being asked to consider and vote on?

 

A:

Progenics stockholders are being asked to consider and vote on the following three proposals:

 

   

the merger agreement proposal;

 

   

the Progenics adjournment proposal; and

 

   

the Progenics compensation advisory proposal.

The adoption of the merger agreement by Progenics stockholders is a condition to the obligations of Progenics and Lantheus Holdings to complete the merger. Neither the approval of the Progenics adjournment proposal nor the approval of the Progenics compensation advisory proposal is a condition to the obligations of Progenics or Lantheus Holdings to complete the merger.

 

Q:

Does the Progenics Board recommend that Progenics stockholders adopt the merger agreement?

 

A:

Yes. The Progenics Board unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair to and in the best interests of Progenics and its stockholders and unanimously recommends that Progenics stockholders vote “FOR” the merger agreement proposal. See “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Progenics’ Reasons for the Merger; Recommendation of the Progenics Board of Directors that Progenics Stockholders Adopt the Merger Agreement” beginning on page 136 of this joint proxy statement/prospectus.

 

Q:

Does the Progenics Board recommend that Progenics stockholders approve the Progenics adjournment proposal?

 

A:

Yes. The Progenics Board unanimously recommends that Progenics stockholders vote “FOR” the Progenics adjournment proposal. See “Progenics Proposal II: Adjournment of the Progenics Special Meeting” beginning on page 217 of this joint proxy statement/prospectus.

 

11


Table of Contents
Q:

What is the Progenics compensation advisory proposal and why am I being asked to vote on it?

 

A:

The SEC has adopted rules that require Progenics to seek an advisory (non-binding) vote on compensation that is tied to or based on completion of the merger and that will or may be paid or provided by Progenics to its named executive officers in connection with the merger.

 

Q:

Does the Progenics Board recommend that Progenics stockholders approve, on an advisory (non-binding) basis, the Progenics compensation advisory proposal?

 

A:

Yes. The Progenics Board unanimously recommends that Progenics stockholders vote “FOR” the Progenics compensation advisory proposal. See “Progenics Proposal III: Advisory Vote On Merger-Related Executive Compensation Arrangements” beginning on page 218 of this joint proxy statement/prospectus.

 

Q:

What happens if the Progenics compensation advisory proposal is not approved?

 

A:

Approval of the Progenics compensation advisory proposal is not a condition to the obligations of Progenics or Lantheus Holdings to complete the merger. The vote is an advisory vote and is not binding on Progenics, the surviving company or Lantheus Holdings. If the merger is completed, the merger-related compensation may be paid to Progenics’ named executive officers to the extent payable in accordance with the terms of the compensation agreements and arrangements even if Progenics stockholders fail to approve the Progenics compensation advisory proposal.

 

Q:

What Progenics stockholder vote is required for the approval of each proposal at the Progenics special meeting?

 

A:

The following are the vote requirements for the proposals at the Progenics special meeting:

 

   

Adoption of the Merger Agreement: The affirmative vote of the holders of a majority of the outstanding shares of Progenics common stock entitled to vote on this proposal. A Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee or any other failure of a Progenics stockholder to vote will have the same effect as a vote “AGAINST” this proposal.

 

   

Approval of the Progenics Adjournment Proposal (if necessary):

 

   

Quorum Not Present: If a quorum is not present at the Progenics special meeting, the affirmative vote of holders of a majority of the shares of Progenics common stock present in person or represented by proxy at the Progenics special meeting. A Progenics stockholder’s abstention from voting on the Progenics adjournment proposal will have the same effect as a vote “AGAINST” the approval of the proposal. The failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the proposal.

 

   

Quorum Present: If a quorum is present at the Progenics special meeting, the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. A Progenics stockholder’s abstention from voting on the Progenics adjournment proposal will have no effect on the approval of the proposal if a quorum is present. The failure of a Progenics stockholder who holds his, her or its shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the proposal.

 

   

Approval of the Progenics Compensation Advisory Proposal: The affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. Accordingly, a

 

12


Table of Contents
 

Progenics stockholder’s abstention from voting will have no effect on the approval of this proposal. The failure of a Progenics stockholder who holds his, her or its shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of this proposal except to the extent it results in there being insufficient shares present at the Progenics special meeting to establish a quorum.

 

Q:

What constitutes a quorum for the Progenics special meeting?

 

A:

The holders of a majority of the outstanding shares of Progenics common stock entitled to vote being present in person or represented by proxy constitutes a quorum for the Progenics special meeting. Shares of Progenics common stock whose holders elect to abstain from voting will be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum. Shares of Progenics common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to his, her or its broker, bank or other nominee will not be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum.

 

Q:

Who is entitled to vote at the Progenics special meeting?

 

A:

All holders of shares of Progenics common stock who held shares at the record date for the Progenics special meeting (the close of business on March 18, 2020) are entitled to receive notice of, and to vote at, the Progenics special meeting. As of the close of business on the record date, there were 86,596,633 shares of Progenics common stock outstanding. Each holder of shares of Progenics common stock is entitled to one vote for each share of Progenics common stock owned at the record date.

 

Q:

When and where is the Progenics special meeting?

 

A:

The Progenics special meeting will be held at the principal executive offices of Progenics, which are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007, on April 28, 2020, at 10:15 a.m., Eastern Time.

 

Q:

What happens if a change to the Progenics special meeting is necessary due to exigent circumstances?

 

A:

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this joint proxy statement/prospectus.

 

Q:

How do I vote my shares at the Progenics special meeting?

 

A:

Via the Internet or by Telephone

If you hold shares of Progenics common stock directly in your name as a stockholder of record, you may vote via the Internet or by telephone by calling by following the directions on the enclosed proxy. In order to submit a proxy to vote via the Internet or by telephone, you will need the control number on your proxy card (which is unique to each Progenics stockholder to ensure all voting instructions are genuine and to prevent duplicate voting). Votes may be submitted via the Internet or by telephone 24 hours a day, seven days a week, and must be received by 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Progenics special meeting. Please be aware that if you vote by telephone or over the Internet, you may incur costs such as telephone and Internet access charges for which you will be responsible.

 

13


Table of Contents

If you hold shares of Progenics common stock in “street name,” meaning through a broker, bank or other nominee, you may vote via the Internet or by telephone only if Internet or telephone voting is made available by your broker, bank or other nominee. Please follow the voting instructions provided by your broker, bank or other nominee with these materials.

You may vote via the Internet or by telephone until 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Progenics special meeting.

By Mail

If you hold shares of Progenics common stock directly in your name as a stockholder of record, in order to vote by mail, you may submit a proxy card. You will need to complete, sign and date your proxy card and return it using the postage-paid return envelope provided.

If you hold shares of Progenics common stock in “street name,” meaning through a broker, bank or other nominee, in order to provide voting instructions by mail you will need to complete, sign and date the voting instruction form provided by your broker, bank or other nominee with these materials and return it in the postage-paid return envelope provided. Your broker, bank or other nominee must receive your voting instruction form in sufficient time to vote your shares.

We recommend you mail your proxy timely to ensure receipt of your proxy before the date of the special meeting.

In Person

If you hold shares of Progenics common stock directly in your name as a stockholder of record, you may vote in person at the Progenics special meeting. Stockholders of record also may be represented by another person at the Progenics special meeting by executing a proper proxy designating that person and having that proper proxy be presented to the inspector of election with the applicable ballot at the Progenics special meeting.

If you hold shares of Progenics common stock in “street name,” meaning through a broker, bank or other nominee, you must obtain a written legal proxy from that broker, bank or other nominee and present it to the inspector of election with your ballot to be able to vote in person at the Progenics special meeting. To request a legal proxy, please contact your broker, bank or other nominee.

Please carefully consider the information contained in this joint proxy statement/prospectus. Whether or not you plan to attend the Progenics special meeting, Progenics encourages you to vote via the Internet, by telephone or by mail so that your shares will be voted in accordance with your wishes even if you later decide not to attend the Progenics special meeting.

 

Q:

If my shares of Progenics common stock are held in “street name,” will my broker, bank or other nominee automatically vote my shares for me?

 

A:

No. Your broker, bank or other nominee will only be permitted to vote your shares of Progenics common stock if you instruct your broker, bank or other nominee how to vote. You should follow the procedures provided by your broker, bank or other nominee regarding the voting of your shares of Progenics common stock.

In general, in accordance with applicable stock exchange rules, if your shares of Progenics common stock are held in “street name” and you do not instruct your broker how to vote your shares, your brokerage firm, in its discretion, may either leave your shares unvoted or vote your shares on routine matters. However, a broker is precluded from exercising its voting discretion with respect to non-routine or “significant” matters, such as the adoption of the merger agreement, the approval of the Progenics adjournment proposal and the approval of the Progenics compensatory advisory proposal. None of the proposals at the Progenics special meeting are routine matters. As a result, if you hold your shares in “street name” through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the special meeting.

 

14


Table of Contents

If a beneficial owner of shares of Progenics common stock held in “street name” does not give voting instructions to its broker, bank or other nominee, then those shares will not be present in person or represented by proxy at the Progenics special meeting. A beneficial owner’s failure to instruct its broker, bank or other nominee how to vote shares of Progenics common stock held in “street name” will have (1) the same effect as a vote “AGAINST” the merger agreement proposal; (2) no effect on the proposal to approve the Progenics adjournment proposal; and (3) no effect on the Progenics compensation advisory proposal, except to the extent it results in there being insufficient shares present at the Progenics special meeting to establish a quorum.

 

Q:

If I submit a proxy, how will my shares covered by the proxy be voted at the Progenics special meeting?

 

A:

If you correctly submit your proxy via the Internet, by telephone or by mail, the persons named in your proxy card will vote your shares in the manner you requested.

 

Q:

If I return a blank proxy, how will my shares be voted at the Progenics special meeting?

 

A:

If you sign your proxy card and return it without indicating how you would like to vote your shares, your proxy will be voted as the Progenics Board unanimously recommends, which is:

 

   

“FOR” the merger agreement proposal;

 

   

“FOR” the Progenics adjournment proposal; and

 

   

“FOR” the Progenics compensation advisory proposal.

 

Q:

Who may attend the Progenics special meeting?

 

A:

Progenics stockholders at the record date for the Progenics special meeting (the close of business on March 18, 2020), or their proxy holders, their authorized representatives and guests of Progenics may attend the Progenics special meeting. If you plan to attend the Progenics special meeting, you will need to provide evidence that you are a stockholder as of the close of business on the record date. This can be a copy of your proxy card or a brokerage statement showing your shares as of the close of business on the record date. You should also bring photo identification. If you hold your shares in street name and wish to vote in person at the meeting, you will need to contact the broker, bank or other nominee that holds your shares in order to obtain a legal proxy from that broker, bank or other nominee.

 

Q:

Can I revoke my proxy or change my voting instructions for Progenics common stock?

 

A:

Yes. You may revoke your proxy or change your vote at any time before the closing of the polls at the Progenics special meeting.

If you are a stockholder of record at the record date for the Progenics special meeting (the close of business on March 18, 2020), you can revoke your proxy or change your vote by:

 

   

sending a signed notice, which bears a date later than the date of the proxy you want to revoke and which is received prior to the date of the Progenics special meeting, stating that you revoke your proxy to MacKenzie Partners, Inc., 1407 Broadway, 27th Floor, New York, New York 10018 or Progenics Pharmaceuticals, Inc., One World Trade Center, 47th Floor, Suite J, New York, New York 10007;

 

   

submitting a valid, later-dated proxy or voting instructions via the Internet or by telephone before 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Progenics special meeting, or by mail that is received prior to the Progenics special meeting; or

 

   

attending the Progenics special meeting (or, if the special meeting is adjourned or postponed, attending the applicable adjourned or postponed meeting) and voting in person, which automatically will cancel any proxy previously given, or revoking your proxy in person, but your attendance alone will not revoke any proxy previously given.

 

15


Table of Contents

If you hold your shares in “street name” through a broker, bank or other nominee, you must contact your broker, bank or other nominee to change your vote or obtain a written legal proxy to vote your shares if you wish to cast your vote in person at the Progenics special meeting.

 

Q:

What happens if I sell my shares of Progenics common stock after the record date but before the Progenics special meeting?

 

A:

The record date for the Progenics special meeting (the close of business on March 18, 2020) is earlier than the date of the Progenics special meeting and earlier than the date that the merger is expected to be completed. If you sell or otherwise transfer your shares of Progenics common stock after the record date but before the date of the Progenics special meeting, you will, unless the transferee obtains a proxy from you, retain your right to vote at the Progenics special meeting. However, you will not have the right to receive the merger consideration to be received by Progenics stockholders in the merger. In order to receive the merger consideration, you must hold your shares immediately prior to completion of the merger.

 

Q:

Are Progenics stockholders entitled to appraisal rights?

 

A:

Yes. Progenics stockholders who do not vote in favor of the adoption of the merger agreement are entitled to exercise appraisal rights under the Delaware General Corporation Law, which is referred to in this joint proxy statement/prospectus as the DGCL, in connection with the merger if they take certain actions and meet certain conditions. For additional information, see the section entitled “Appraisal or Dissenters’ Rights Available to Progenics Stockholders” beginning on page 166 of this joint proxy statement/prospectus and the full text of Section 262, attached as Annex E to this joint proxy statement/prospectus. Because of the complexity of the DGCL relating to appraisal rights, if you wish to exercise your appraisal rights, we encourage you to seek the advice of legal counsel. Failure to strictly comply with Section 262 may result in the loss of the right of appraisal.

Progenics stockholders considering seeking appraisal should be aware that the “fair value” of their shares of Progenics common stock as determined by the Delaware Court of Chancery under Section 262 could be greater than, the same as or less than the merger consideration.

 

Q:

Who is the inspector of the election for the Progenics special meeting?

 

A:

A representative of First Coast Results, Inc. will serve as the independent inspector of election for the Progenics special meeting.

 

Q:

Will a proxy solicitor be used for the Progenics special meeting?

 

A:

Yes. Progenics has engaged MacKenzie Partners, Inc. to assist in the solicitation of proxies for the Progenics special meeting, and Progenics has agreed to pay them a fee of $125,000.

 

Q:

Where can I find the voting results of the Progenics special meeting?

 

A:

The preliminary voting results will be announced at the Progenics special meeting. In addition, within four business days following certification of the final voting results, Progenics intends to file the final voting results with the SEC on a Current Report on Form 8-K.

 

Q:

Should I send in my Progenics share certificates now?

 

A:

No. Progenics stockholders should not send in their share certificates at this time. After completion of the merger, Lantheus Holdings’ exchange agent will send you a letter of transmittal and instructions for exchanging your shares of Progenics common stock for the merger consideration. The shares of Lantheus Holdings common stock you receive in the merger will be issued in book-entry form and, unless otherwise

 

16


Table of Contents
  requested, physical certificates will not be issued. Lantheus Holdings stockholders will keep their existing share certificates, if any, and will not be required to take any action with respect to their certificates. See “The Merger Agreement—Procedures for Exchanging Progenics Common Stock for Lantheus Holdings Common Stock” beginning on page 181 of this joint proxy statement/prospectus.

 

Q:

As a holder of options issued by Progenics to purchase Progenics common stock, what will I receive in the merger?

 

A:

At the effective time of the merger, each outstanding and unexercised option to purchase shares of Progenics common stock under any Progenics stock plan, which is referred to in this joint proxy statement/prospectus as a Progenics stock option, whether or not vested, will be treated as described below.

If such Progenics stock option is an in-the-money option, it will be assumed by Lantheus Holdings and converted into an option, which is referred to in this joint proxy statement/prospectus as a Lantheus Holdings stock option, to purchase (a) that number of shares of Lantheus Holdings common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying (i) the total number of shares of Progenics common stock subject to such Progenics stock option immediately prior to the effective time of the merger by (ii) the exchange ratio, (b) at a per-share exercise price (rounded up to the nearest whole cent) equal to the quotient obtained by dividing (i) the exercise price per share of Progenics common stock at which such Progenics stock option was exercisable immediately prior to the effective time of the merger by (ii) the exchange ratio. Each such Lantheus Holdings stock option is referred to in this joint proxy statement/prospectus as an in-the-money assumed option. Each in-the-money assumed option will continue to have the same terms and conditions (including the applicable time-vesting and/or performance-vesting conditions and any provisions for accelerated vesting) as applied to the corresponding Progenics in-the-money option immediately prior to the effective time of the merger.

In addition to an in-the-money assumed option, each holder of a Progenics in-the-money option will also receive either (a) with respect to any Progenics in-the-money option that is vested immediately prior to the effective time of the merger, which is referred to in this joint proxy statement/prospectus as a vested in-the-money option, one fully vested CVR for each share of Progenics common stock subject to such vested in-the-money option that will be payable under the terms of the CVR agreement, which is referred to in this joint proxy statement/prospectus as a vested CVR, or (b) with respect to any Progenics in-the-money option that is not vested immediately prior to the effective time of the merger, which is referred to in this joint proxy statement/prospectus as an unvested in-the-money option, one unvested CVR for each share of Progenics common stock subject to such unvested in-the-money option that will be subject to vesting upon the same terms and conditions (including the applicable time-vesting and/or performance-vesting conditions and any provisions for accelerated vesting) that applied to the corresponding Progenics in-the-money option and payable under the terms of the CVR agreement, which is referred to in this joint proxy statement/prospectus as an unvested CVR. However, if the holder of such unvested CVR is employed or in the service of Lantheus Holdings, the surviving corporation or one of their subsidiaries, on the date a payment is due under the CVR agreement, then such unvested CVR will be deemed vested on such date with respect to such payment. In the event that the employment or other service with Lantheus Holdings, the surviving corporation or one of their subsidiaries, of a holder of an unvested CVR is terminated for any reason prior to the vesting of the unvested CVR for any reason that would trigger the forfeiture of the corresponding unvested in-the-money option, such unvested CVR will be forfeited without payment.

If such Progenics stock option is an out-of-the-money option, it will be assumed by Lantheus Holdings and converted into an option to purchase (a) that number of shares of Lantheus Holdings common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying (i) the total number of shares of Progenics common stock that were subject to such out-of-the-money option immediately prior to the effective time of the merger by (ii) the quotient, rounded to the nearest one hundredth, of (x) the average of the volume weighted average price paid per share of Progenics common stock on the date that the stockholder approvals required under the merger agreement are obtained and each of the complete trading days immediately following such date, ending with (and including) the last complete trading day prior to the closing date, divided by (y) the average of the volume weighted average price paid per share of

 

17


Table of Contents

Lantheus Holdings common stock on the date that the stockholder approvals required under the merger agreement are obtained and each of the complete trading days immediately following such date, ending with (and including) the last complete trading day prior to the closing date with such quotient referred to in this joint proxy statement/prospectus as the out-of-the-money option exchange ratio, (b) at a per-share exercise price (rounded up to the nearest whole cent) equal to the quotient obtained by dividing (i) the exercise price per share of Progenics common stock at which such Progenics stock option was exercisable immediately prior to the effective time of the merger by (ii) the out-of-the-money option exchange ratio. No CVRs will be issued in respect of out-of-the-money options. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of this joint proxy statement/prospectus for further information.

 

Q:

Is the transaction expected to be taxable to Progenics stockholders?

 

A:

As of the date hereof, the merger is intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and, for U.S. federal income tax purposes, generally, no gain or loss is intended to be recognized by the Progenics stockholders to the extent the Progenics stockholders receive shares of Lantheus Holdings common stock in exchange for shares of Progenics common stock. Subject to the qualifications, exceptions, assumptions and limitations contained in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus, if the merger qualifies as a “reorganization” within the meaning of Section 368(a) of the Code, then, for U.S. federal income tax purposes, generally, gain will be recognized by a U.S. holder (as defined in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences”) of Progenics common stock equal to the lesser of (i) the sum of the cash received in lieu of fractional shares and the fair market value of the CVRs received as determined for U.S. federal income tax purposes and (ii) the difference, if any, between (x) the sum of the fair market values of the Lantheus Holdings common stock and the CVRs, as determined for U.S. federal income tax purposes, and the cash received in lieu of fractional shares and (y) such holder’s adjusted tax basis in the Progenics common stock surrendered. The tax treatment of the receipt of the CVRs and payments thereunder is uncertain, and the alternative treatments are described in the section entitled “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences”.

Subject to the qualifications, exceptions, assumptions and limitations contained in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus, if the merger does not qualify as a “reorganization” under Section 368(a) of the Code, then, for U.S. federal income tax purposes, a U.S. holder of Progenics common stock would recognize gain or loss in an amount equal to the difference, if any, between (i) the sum of the fair market values of the Lantheus Holdings common stock and the CVRs, as determined for U.S. federal income tax purposes, and any cash received in lieu of fractional shares and (ii) such holder’s adjusted tax basis in the Progenics common stock surrendered.

Each Progenics stockholder is urged to read the discussion in the section entitled “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus and to consult its tax advisor to determine the particular U.S. federal, state or local or non-U.S. income or other tax consequences to it of the merger.

 

18


Table of Contents
Q:

If I am a Progenics stockholder, whom should I call with questions?

 

A:

If you have any questions about the merger agreement, the merger, the merger agreement proposal, the Progenics adjournment proposal, the Progenics compensation advisory proposal, the Progenics special meeting or this joint proxy statement/prospectus, desire additional copies of this joint proxy statement/prospectus, proxy cards or voting instruction forms or need help voting your shares of Progenics common stock, you should contact:

MacKenzie Partners, Inc.

1407 Broadway, 27th Floor

New York, New York 10018

Toll-Free: (800) 322-2885

or

(212) 929-5500

Email: pgnx@mackenziepartners.com

For Both Lantheus Holdings Stockholders and Progenics Stockholders

 

Q:

What if I hold shares in both Progenics and Lantheus Holdings?

 

A:

If you are both a Progenics stockholder and a Lantheus Holdings stockholder, you will receive separate packages of proxy materials from each company. A vote as a Progenics stockholder for the merger agreement proposal (or any other proposal to be considered at the Progenics special meeting) will not constitute a vote as a Lantheus Holdings stockholder to approve the stock issuance proposal (or any other proposal to be considered at the Lantheus Holdings special meeting), and vice versa. Therefore, please complete, sign and date and return all proxy cards and/or voting instructions that you receive from Progenics or Lantheus Holdings, or submit your proxy or voting instructions for each set of voting materials over the Internet or by telephone in order to ensure that all of your shares are voted.

 

Q:

Is completion of the merger subject to any conditions?

 

A:

Yes. Lantheus Holdings and Progenics are not required to complete the merger unless a number of conditions are satisfied (or, to the extent permitted by applicable law, waived by the party entitled to waive such condition). These conditions include the adoption of the merger agreement by Progenics stockholders and the approval of the stock issuance proposal by Lantheus Holdings stockholders. For a more complete summary of the conditions that must be satisfied (or, to the extent permitted by applicable law, waived) prior to completion of the merger, see “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 184 of this joint proxy statement/prospectus.

 

Q:

When do you expect to complete the merger?

 

A:

As of the date of this joint proxy statement/prospectus, Progenics and Lantheus Holdings expect to complete the merger early in the second quarter of 2020, subject to the adoption of the merger agreement by Progenics stockholders, the approval of the stock issuance proposal by Lantheus Holdings stockholders, and the satisfaction (or, to the extent permitted by applicable law, waiver) of the other conditions that must be satisfied (or, to the extent permitted by applicable law, waived) prior to completion of the merger. However, no assurance can be given as to when, or if, the merger will be completed.

 

Q:

What risks should I consider in deciding whether to vote in favor of the merger proposal and/or the stock issuance proposal?

 

A:

You should carefully review the risks and uncertainties discussed under the heading “Risk Factors” and elsewhere in this joint proxy statement/prospectus and Part I, Item 1A, “Risk Factors” in each company’s

 

19


Table of Contents
  Annual Report on Form 10-K for the year ended December 31, 2019, as updated by their respective future filings with the SEC, each of which is on file or will be filed with the SEC, which maintains a website located at www.sec.gov with this information, and all of which is incorporated by reference into this joint proxy statement/prospectus, as well as the section of this joint proxy statement/prospectus entitled “Risk Factors,” which sets forth certain risks and uncertainties related to the merger, risks and uncertainties to which the combined company’s business will be subject, and risks and uncertainties to which each of Lantheus Holdings and Progenics, as an independent company, is subject.

 

Q:

What do I need to do now?

 

A:

Carefully read and consider the information contained in and incorporated by reference into this joint proxy statement/prospectus in its entirety, including its annexes. Then, please promptly vote your shares of Progenics common stock and/or shares of Lantheus Holdings common stock, as applicable, which you may do by:

 

   

completing, dating, signing and returning the enclosed proxy card for the applicable company in the accompanying postage-paid return envelope;

 

   

submitting your proxy via the Internet or by telephone by following the instructions included on your proxy card for such company; or

 

   

attending the applicable special meeting and voting by ballot in person.

If you hold shares in “street name” through a broker, bank or other nominee, please instruct your broker, bank or other nominee to vote your shares by following the instructions that the broker, bank or other nominee provides to you with these materials.

 

20


Table of Contents

SUMMARY

This summary highlights selected information from this joint proxy statement/prospectus. It may not contain all of the information that is important to you. You are urged to read carefully the entire joint proxy statement/prospectus and the other documents attached to or referred to in this joint proxy statement/prospectus in order to fully understand the merger agreement, the proposed merger and the other transactions contemplated by the merger agreement. See “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus. Each item in this summary refers to the page of this joint proxy statement/prospectus on which the more detailed discussion of that subject begins.

The Companies (see page 77)

Lantheus Holdings

Lantheus Holdings was incorporated under the laws of the State of Delaware in November 2007 under the name ACP Lantern Holdings, Inc. In 2008, ACP Lantern Holdings, Inc. changed its name to Lantheus MI Holdings, Inc. and, in 2014, changed its name again to Lantheus Holdings, Inc. Lantheus Holdings is a leader in the development, manufacturing, and commercialization of innovative diagnostic medical imaging agents and products across a range of imaging modalities, including echocardiography and nuclear imaging. Lantheus Holdings’ commercial products are used by cardiologists, nuclear physicians, radiologists, internal medicine physicians, technologists and sonographers working in a variety of clinical settings.

Lantheus Holdings’ portfolio of commercial products includes DEFINITY, the leading ultrasound contrast imaging agent based on revenue and usage in the U.S., and TechneLite, a self-contained system or generator of technetium-99m, a radioactive isotope used by radiopharmacies to prepare various nuclear imaging agents. Since its launch in 2001, DEFINITY has been used in imaging procedures in more than 13.8 million patients throughout the world. Additionally, as of December 31, 2019, Lantheus Holdings estimates that TechneLite had approximately one third of the U.S. technetium generator market.

Lantheus Holdings common stock, par value $0.01 per share, (NASDAQ: LNTH) is listed on the Nasdaq Global Market under the symbol “LNTH.” The principal executive offices of Lantheus Holdings are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862; its telephone number is (978) 671-8001; and its website is www.lantheus.com. Information on Lantheus Holdings’ Internet website is not incorporated by reference into or otherwise part of this joint proxy statement/prospectus.

This joint proxy statement/prospectus incorporates important business and financial information about Lantheus Holdings from other documents that are not included in or delivered with this joint proxy statement/prospectus. For a list of the documents that are incorporated by reference, see “Where You Can Find More Information”.

Progenics

Progenics, which has been listed on Nasdaq since 1997, was incorporated in Delaware in 1986, commenced principal operations in 1988, and throughout has been engaged primarily in research and development efforts, establishing corporate collaborations and related activities. Progenics is an oncology company focused on the development and commercialization of innovative targeted medicines and artificial intelligence to find, fight and follow cancer. Progenics’ pipeline includes therapeutic agents designed to precisely target cancer (AZEDRA, 1095 and PSMA TTC), as well as a prostate-specific membrane antigen (“PSMA”) targeted imaging agents for prostate cancer (PyL and 1404).

Highlights of Progenics’ recent progress include the enrollment completion of Progenics’ pivotal Phase 3 trial for PyL and the positive topline results.



 

21


Table of Contents

Progenics common stock, par value $0.0013 per share, is listed on the Nasdaq Stock Market under the symbol “PGNX.” The principal executive offices of Progenics are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007; its telephone number is (646) 975-2500; and its website is www.progenics.com. Information on Progenics’ Internet website is not incorporated by reference into or otherwise part of this joint proxy statement/prospectus.

This joint proxy statement/prospectus incorporates important business and financial information about Progenics from other documents that are not included in or delivered with this joint proxy statement/prospectus. For a list of the documents that are incorporated by reference, see “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

Plato Merger Sub, Inc.

Merger Sub was incorporated under the laws of the State of Delaware on September 26, 2019, and is a wholly-owned subsidiary of Lantheus Holdings. Merger Sub was formed solely for the purpose of completing the merger. Merger Sub has not carried on any activities or operations to date, except for activities incidental to its formation and activities undertaken in connection with the merger. By operation of the merger, Merger Sub will be merged with and into Progenics, with Progenics surviving the merger as a wholly-owned subsidiary of Lantheus Holdings.

The principal executive offices of Merger Sub are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, and its telephone number is (978) 671-8001.

The Merger (see page 179)

On October 1, 2019, Lantheus Holdings, Merger Sub and Progenics entered into an Agreement and Plan of Merger, which is referred to in this joint proxy statement/prospectus as the original merger agreement. On February 20, 2020, the parties to the original merger agreement entered into an Amended and Restated Agreement and Plan of Merger, which is referred to in this joint proxy statement/prospectus as the merger agreement, that amended and restated the original merger agreement in its entirety. Subject to the terms and conditions of the merger agreement and in accordance with applicable law, Merger Sub will be merged with and into Progenics, with Progenics continuing as the surviving corporation and a wholly-owned subsidiary of Lantheus Holdings. Upon completion of the merger, shares of Progenics common stock will no longer be publicly traded, will be delisted from the Nasdaq Stock Market and will be deregistered under the Exchange Act, and Progenics will no longer be required to file periodic reports with the SEC.

A copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus. You should read the merger agreement carefully and in its entirety because it is the legal document that governs the merger.

Special Meeting of Stockholders of Lantheus Holdings (see page 79)

Meeting. The Lantheus Holdings special meeting will be held at the principal executive offices of Lantheus Holdings, which are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, on April 28, 2020, at 11:15 a.m., Eastern Time. At the Lantheus Holdings special meeting, Lantheus Holdings stockholders will be asked to consider and vote on the following proposals:

 

   

the stock issuance proposal; and

 

   

the Lantheus Holdings adjournment proposal.

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may



 

22


Table of Contents

impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this joint proxy statement/prospectus. We encourage you to vote your shares prior to the Lantheus Holdings special meeting.

Record Date. The Lantheus Holdings Board has fixed the close of business on March 18, 2020 as the record date for the Lantheus Holdings special meeting. Only Lantheus Holdings stockholders of record at the record date are entitled to receive notice of, and to vote at, the Lantheus Holdings special meeting or any adjournment or postponement of the Lantheus Holdings special meeting, unless a new record date is set in connection with an adjournment or postponement of the Lantheus Holdings special meeting. As of the close of business on the record date, there were 39,716,519 shares of Lantheus Holdings common stock, $0.01 par value per share, outstanding and entitled to vote at the Lantheus Holdings special meeting. Each holder of Lantheus Holdings common stock is entitled to one vote for each share of Lantheus Holdings common stock owned as of the close of business on the record date.

Quorum. The presence at the Lantheus Holdings special meeting, in person or by proxy, of the holders of a majority of the outstanding shares of Lantheus Holdings common stock as of the close of business on the record date (the close of business on March 18, 2020) and entitled to vote at the meeting will constitute a quorum. Elections to abstain from voting will be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum. Shares of Lantheus Holdings common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to its broker, bank or other nominee, and shares of Lantheus Holdings common stock with respect to which the beneficial owner otherwise fails to vote, will not be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum. There must be a quorum for the vote on the stock issuance proposal to be taken at the Lantheus Holdings special meeting. Failure of a quorum to be present at the Lantheus Holdings special meeting will necessitate an adjournment of the meeting and will subject Lantheus Holdings to additional expense.

Required Vote. The affirmative vote of at least a majority of the votes cast by holders of outstanding shares of Lantheus Holdings common stock at a duly called and held meeting of Lantheus Holdings stockholders at which a quorum is present is required to approve the stock issuance proposal in connection with the merger. Lantheus Holdings cannot complete the merger unless its stockholders approve the stock issuance proposal. A majority of the votes cast means that the number of votes cast “for” the stock issuance proposal must exceed the number of votes cast “against.” A Lantheus Holdings stockholder’s abstention from voting on the stock issuance, the failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of the proposal except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

Approval of the Lantheus Holdings adjournment proposal, assuming a quorum, as defined under Lantheus Holdings’ by-laws, is present, requires the affirmative vote of the holders of a majority of the shares of Lantheus Holdings common stock present in person or represented by proxy at the Lantheus Holdings special meeting and entitled to vote thereat. For purposes of the Lantheus Holdings adjournment proposal, “shares of Lantheus Holdings common stock present in person or represented by proxy” on the proposal consist of votes “for” or “against” as well as elections to abstain from voting on the proposal. As a result, a Lantheus Holdings stockholder’s abstention from voting on the Lantheus Holdings adjournment proposal will have the same effect as a vote “AGAINST” the approval of the proposal. The failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of this proposal except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.



 

23


Table of Contents

Stock Ownership of and Voting by Lantheus Holdings Directors and Executive Officers (see page 230)

As of the close of business on the record date, Lantheus Holdings’ directors and executive officers and their affiliates beneficially owned and had the right to vote in the aggregate 589,968 shares of Lantheus Holdings common stock at the Lantheus Holdings special meeting, which represents approximately 1.5% of the shares of Lantheus Holdings common stock entitled to vote at the Lantheus Holdings special meeting.

Each of Lantheus Holdings’ directors and executive officers is expected, as of the date of this joint proxy statement/prospectus, to vote his or her shares of Lantheus Holdings common stock “FOR” the stock issuance proposal and “FOR” the Lantheus Holdings adjournment proposal, although none of Lantheus Holdings’ directors and executive officers have entered into any agreement requiring them to do so.

Special Meeting of Stockholders of Progenics (see page 85)

Meeting. The Progenics special meeting will be held at the principal executive offices of Progenics, which are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007, on April 28, 2020, at 10:15 a.m., Eastern Time. At the Progenics special meeting, Progenics stockholders will be asked to consider and vote on the following proposals:

 

   

the merger agreement;

 

   

the Progenics adjournment proposal; and

 

   

the Progenics compensation advisory proposal.

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this joint proxy statement/prospectus. We encourage you to vote your shares prior to the Progenics special meeting.

Record Date. The Progenics Board has fixed the close of business on March 18, 2020 as the record date for the Progenics special meeting. Only Progenics stockholders of record at the record date are entitled to receive notice of, and to vote at, the Progenics special meeting or any adjournment or postponement of the Progenics special meeting, unless a new record date is set in connection with an adjournment or postponement of the Progenics special meeting. As of the close of business on the record date, there were 86,596,633 shares of Progenics common stock outstanding and entitled to vote at the Progenics special meeting. Each holder of shares of Progenics common stock is entitled to one vote for each share of Progenics common stock owned as of the close of business on the record date.

Quorum. The presence at the Progenics special meeting, in person or by proxy, of the holders of a majority of the outstanding shares of Progenics common stock at the record date (the close of business on March 18, 2020) and entitled to vote at the meeting will constitute a quorum. Elections to abstain from voting will be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum. Shares of Progenics common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to its broker, bank or other nominee, and shares of Progenics common stock with respect to which the beneficial owner otherwise fails to vote, will not be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum. There must be a quorum for the vote on the merger agreement proposal and the vote on the Progenics compensation advisory proposal to be taken at the Progenics special meeting. Failure of a quorum to be present at the Progenics special meeting will necessitate an adjournment of the meeting and will subject Progenics to additional expense.



 

24


Table of Contents

Required Vote. The affirmative vote of the holders of a majority of the shares of Progenics common stock outstanding and entitled to vote thereon is required to approve the merger agreement proposal. Progenics cannot complete the merger and the merger consideration will not be paid unless its stockholders approve the merger agreement proposal and the other closing conditions specified in the merger agreement are met. A Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee or any other failure of a Progenics stockholder to vote will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

The vote required to approve the Progenics adjournment proposal depends on whether or not a quorum is present at the Progenics special meeting. If a quorum is not present at the Progenics special meeting, approval of the Progenics adjournment proposal requires the affirmative vote of holders of a majority of the shares of Progenics common stock present in person or represented by proxy at the Progenics special meeting. For purposes of this proposal, if a quorum is not present “shares of Progenics common stock present in person or represented by proxy” consist of votes “for” or “against” as well as elections to abstain from voting on the proposal. A Progenics stockholder’s abstention from voting on the Progenics adjournment proposal will have the same effect as a vote “AGAINST” the approval of the proposal. The failure of a Progenics stockholder who holds his, her or its shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the proposal. If a quorum is present at the Progenics special meeting, approval of the Progenics adjournment proposal requires the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. For purposes of this proposal, if a quorum is present, “a majority of the votes cast” means the number of votes cast “FOR” the proposal must exceed the number of votes cast “AGAINST” the proposal. A Progenics stockholder’s abstention from voting on the Progenics adjournment proposal will have no effect on the approval of the proposal if a quorum is present. The failure of a Progenics stockholder who holds his, her or its shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the proposal.

Approval, on an advisory (non-binding) basis, of the Progenics compensation advisory proposal (assuming a quorum, as defined under Progenics’ by-laws, is present) requires the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. For purposes of the Progenics compensation advisory proposal, “a majority of votes cast” means the number of votes cast “FOR” the proposal exceeds the number of votes cast “AGAINST” the proposal. A Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the compensation advisory proposal, except to the extent it results in there being insufficient shares present at the Progenics special meeting to establish a quorum.

Stock Ownership of and Voting by Progenics Directors and Executive Officers (see page 87)

As of the close of business on the record date, Progenics’ directors and executive officers and their affiliates owned and had the right to vote in the aggregate 87,323 shares of Progenics common stock at the Progenics special meeting, which represents approximately 0.10% of the shares of Progenics common stock entitled to vote at the Progenics special meeting.

Each of Progenics’ directors and executive officers is expected, as of the date of this joint proxy statement/prospectus, to vote his or her shares of Progenics common stock “FOR” the proposal to adopt the merger agreement, “FOR” the Progenics adjournment proposal and “FOR” the Progenics compensation advisory



 

25


Table of Contents

proposal, although none of Progenics’ directors or executive officers have entered into any agreement requiring them to do so.

What Progenics Stockholders Will Receive in the Merger (see page 180)

If the merger is completed, Progenics stockholders (other than the excluded holders) will be entitled to receive, in exchange for each share of Progenics common stock that they own immediately prior to the completion of the merger, 0.31 of a share of Lantheus Holdings common stock and one CVR representing the right to receive, subject to the CVR cap, such stockholder’s pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyL in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively, as set forth in the CVR agreement.

The exchange ratio is fixed, which means that it will not change between now and the date of the merger, regardless of whether the market price of either shares of Lantheus Holdings common stock or shares of Progenics common stock changes. Therefore, the value of the stock consideration will depend on the market price of shares of Lantheus Holdings common stock at the time Progenics stockholders receive shares of Lantheus Holdings common stock in the merger. Based on the closing price of shares of Lantheus Holdings common stock on the Nasdaq Global Market on February 19, 2020, the last trading day prior to announcement of the amended transaction between Lantheus Holdings and Progenics, the stock consideration represented approximately $5.12 in value for each share of Progenics common stock. Based on the closing price of shares of Lantheus Holdings common stock on the Nasdaq Global Market on March 18, 2020, the most recent trading day prior to the date of this joint proxy statement/prospectus for which this information was available, the stock consideration represented approximately $2.82 in value for each share of Progenics common stock. The market price of shares of Lantheus Holdings common stock has fluctuated since the date of the announcement of the merger agreement and will continue to fluctuate from the date of this joint proxy statement/prospectus to the date of the Progenics special meeting and the date the merger is completed and thereafter. The market price of shares of Lantheus Holdings common stock when received by Progenics stockholders after the merger is completed could be greater than, less than or the same as the market price of shares of Lantheus Holdings common stock on the date of this joint proxy statement/prospectus or at the time of the Progenics special meeting or any adjournment or postponement thereof.

Treatment of Progenics Stock Options (see page 183)

At the effective time of the merger, each outstanding and unexercised Progenics stock option, whether or not vested, will be treated as described below.

If such Progenics stock option is an in-the-money option, it will be assumed by Lantheus Holdings and converted into an option to purchase (a) that number of shares of Lantheus Holdings common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying (i) the total number of shares of Progenics common stock subject to such Progenics stock option immediately prior to the effective time of the merger by (ii) the exchange ratio, (b) at a per-share exercise price (rounded up to the nearest whole cent) equal to the quotient obtained by dividing (i) the exercise price per share of Progenics common stock at which such Progenics stock option was exercisable immediately prior to the effective time of the merger by (ii) the exchange ratio. Each such in-the-money assumed option will continue to have the same terms and conditions (including the applicable time-vesting and/or performance-vesting conditions and any provisions for accelerated vesting) as applied to the corresponding Progenics in-the-money option immediately prior to the effective time of the merger.

In addition to an in-the-money assumed option, each holder of a Progenics in-the-money option will also receive either (a) with respect to any vested in-the-money option that is vested immediately prior to the effective time of the merger, one vested CVR for each share of Progenics common stock underlying such vested in-the-money



 

26


Table of Contents

option, or (b) with respect to any unvested in-the-money option, one unvested CVR for each share of Progenics common stock subject to such unvested in-the-money option. However, if the holder of such unvested CVR is employed or in the service of Lantheus Holdings, the surviving corporation or one of their subsidiaries, on the date a payment is due under the CVR agreement, then such unvested CVR will be deemed vested on such date with respect to such payment. In the event that the employment or other service with Lantheus Holdings, the surviving corporation or one of their subsidiaries, of a holder of an unvested CVR is terminated prior to the vesting of the unvested CVR for any reason that would trigger the forfeiture of the corresponding unvested in-the-money option, such unvested CVR will be forfeited without payment.

If such Progenics stock option is an out-of-the-money option, it will be assumed by Lantheus Holdings and converted into an option to purchase (a) that number of shares of Lantheus Holdings common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying (i) the total number of shares of Progenics common stock that were subject to such out-of-the-money option immediately prior to the effective time of the merger by (ii) the out-of-the-money option exchange ratio, (b) at a per-share exercise price (rounded up to the nearest whole cent) equal to the quotient obtained by dividing (i) the exercise price per share of Progenics common stock at which such Progenics stock option was exercisable immediately prior to the effective time of the merger by (ii) the out-of-the-money option exchange ratio. No CVRs will be issued in respect of out-of-the-money options. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of this joint proxy statement/prospectus for further information.

The Bridge Loan Agreement (see page 210)

On March 15, 2020, Progenics and an affiliate of Lantheus Holdings, Lantheus Medical Imaging, Inc., which is referred to in this joint proxy statement/prospectus as Lantheus Medical Imaging, entered into a bridge loan agreement, which is referred to in this joint proxy statement as the bridge loan agreement, pursuant to which Lantheus Medical Imaging agreed to provide for a secured short-term loan to Progenics on or after May 1, 2020 in an aggregate principal amount of up to $10.0 million, which is referred to in this joint proxy statement/prospectus as the bridge loan. The bridge loan matures on the earlier to occur of (a) September 30, 2020 and (b) the date on which Progenics enters into a debt financing or similar arrangements or any amendment to, or replacement of, its existing debt provided by one or more third parties following the termination date of the merger agreement, in either case, having aggregate net cash proceeds that exceed the amount then required to repay all obligations under the bridge loan agreement in full in cash.

Progenics will use the proceeds of the bridge loan for working capital and other general corporate purposes. The proceeds will not be used in connection with any related party transaction, the purchase or repurchase of any capital stock of Progenics, acquisition of assets or other merger activity unrelated to the merger agreement, or in any manner that would reasonably be expected to prevent the merger from constituting a tax-free reorganization described in Section 368(a) and related provisions of the Code.

The bridge loan bears interest at rate per annum of 9.5%. No amortization, interest or other payments are required to be paid under the bridge loan agreement until the maturity date, provided that if Progenics or any of its subsidiaries receives net cash proceeds from any debt financing or other similar arrangement entered into outside the ordinary course of business, Progenics is required to prepay the bridge loan in an amount equal to such net cash proceeds within two business days thereof. Progenics may make voluntary prepayments at any time and from time to time (provided that any partial voluntary prepayment will not be in an amount less than $500,000) together with accrued interest thereon, without premium or penalty.

The bridge loan is secured through the pledge to Lantheus Medical Imaging of all of the issued and outstanding shares of capital stock of Molecular Insight Pharmaceuticals, Inc., a subsidiary of Progenics, which is referred to in this joint proxy statement/prospectus as MIPI, and any debt of MIPI owed to Progenics.



 

27


Table of Contents

Progenics is required to use commercially reasonable efforts to enter into a debt financing with net cash proceeds in excess of the amount then required to repay all obligations in full in cash promptly following the termination of the merger agreement.

The bridge loan agreement contains customary events of default for a loan of this type.

Recommendation of the Lantheus Holdings Board of Directors (see page 79)

The Lantheus Holdings Board unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the stock issuance, are advisable, fair to and in the best interests of Lantheus Holdings and its stockholders. The Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote FOR the stock issuance proposal. For the factors considered by the Lantheus Holdings Board in reaching this decision, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Lantheus Holdings’ Reasons for the Merger; Recommendation of the Lantheus Holdings Board of Directors that Lantheus Holdings Stockholders Approve the Stock Issuance” beginning on page 127 of this joint proxy statement/prospectus.

The Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote FOR the Lantheus Holdings adjournment proposal. See “Lantheus Holdings Proposal II: Adjournment of the Lantheus Holdings Special Meeting” beginning on page 216 of this joint proxy statement/prospectus.

Recommendation of the Progenics Board of Directors (see page 85)

The Progenics Board unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair to and in the best interests of Progenics and its stockholders. The Progenics Board unanimously recommends that Progenics stockholders vote FOR the merger agreement proposal. For the factors considered by the Progenics Board in reaching this decision, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Progenics’ Reasons for the Merger; Recommendation of the Progenics Board of Directors that Progenics Stockholders Adopt the Merger Agreement” beginning on page 136 of this joint proxy statement/prospectus.

The Progenics Board unanimously recommends that Progenics stockholders vote FOR the Progenics adjournment proposal. See “Progenics Proposal II: Adjournment of the Progenics Special Meeting” beginning on page 217 of this joint proxy statement/prospectus.

In addition, the Progenics Board unanimously recommends that Progenics stockholders vote FOR the Progenics compensation advisory proposal. See “Progenics Proposal III: Advisory Vote On Merger—Related Executive Compensation Arrangements” beginning on page 218 of this joint proxy statement/prospectus.

Opinion of Lantheus Holdings’ Financial Advisor (see page 140)

Lantheus Holdings retained SVB Leerink LLC, which is referred to in this proxy statement/prospectus as SVB Leerink, as its financial advisor in connection with this transaction. The Lantheus Holdings Board selected SVB Leerink to act as Lantheus Holdings’ financial advisor based on SVB Leerink’s qualifications, reputation, experience and expertise in the biopharmaceuticals industry, its knowledge of and involvement in recent transactions in the biopharmaceutical industry, and its relationship and familiarity with Lantheus Holdings and its business. SVB Leerink is an internationally recognized investment banking firm that has substantial experience in transactions similar to this transaction. In connection with this engagement, Lantheus Holdings requested that



 

28


Table of Contents

SVB Leerink evaluate the fairness, from a financial point of view, to Lantheus Holdings of the consideration of (i) 0.31 of a share of Lantheus Holdings common stock, without interest, and (ii) one CVR per share of Progenics common stock provided for in the merger agreement. On February 19, 2020, SVB Leerink rendered to the Lantheus Holdings Board its oral opinion, which was subsequently confirmed by delivery of a written opinion dated February 19, 2020, that, as of such date and based upon and subject to the various assumptions, qualifications and limitations upon the review undertaken by SVB Leerink in preparing its opinion, the consideration of (i) 0.31 of a share of Lantheus Holdings common stock, without interest, and (ii) one CVR per share of Progenics common stock provided for in the merger agreement was fair, from a financial point of view, to Lantheus Holdings.

SVB Leerink’s financial advisory services and opinion were provided for the information and assistance of the members of the Lantheus Holdings Board (in their capacity as directors and not in any other capacity) in connection with and for purposes of the Lantheus Holdings Board’s consideration of this transaction and the SVB Leerink opinion addressed only the fairness, from a financial point of view, as of the date thereof, to Lantheus Holdings of the consideration of (i) 0.31 of a share of Lantheus Holdings common stock, without interest, and (ii) one CVR per share of Progenics common stock provided for in the merger agreement. The SVB Leerink opinion did not address any other term or aspect of the merger agreement or this transaction and does not constitute a recommendation to any stockholder of Lantheus Holdings as to whether or how such holder should vote with respect to the merger or otherwise act with respect to this transaction or any other matter. SVB Leerink has provided its written consent to the reproduction of its opinion in this proxy statement/prospectus.

The full text of the SVB Leerink written opinion, dated February 19, 2020, which describes the assumptions, qualifications and limitations upon the review undertaken by SVB Leerink in preparing its opinion, is attached hereto as Annex C and is incorporated by reference herein. Lantheus Holdings stockholders should read the opinion carefully in its entirety.

Opinion of Progenics’ Financial Advisor (see page 148)

In connection with the merger, BofA Securities, Inc., which is referred to in this joint proxy statement/prospectus as BofA Securities, Progenics’ financial advisor, delivered to the Progenics Board a written opinion, dated February 20, 2020, as to the fairness, from a financial point of view and as of the date of the opinion, to the holders of Progenics common stock (other than shares of Progenics common stock held by Progenics, Lantheus Holdings, Merger Sub, or any of their respective wholly-owned subsidiaries, all of which shares will be canceled, and the holders of dissenting shares, which are, collectively, referred to in this joint proxy statement/prospectus as the excluded holders) of the exchange ratio, taking into account the value of the CVR consideration, provided for in the merger. The full text of the written opinion, dated February 20, 2020, of BofA Securities, which describes, among other things, the assumptions made, procedures followed, factors considered and limitations on the review undertaken, is attached as Annex D to this joint proxy statement/prospectus and is incorporated by reference herein in its entirety.

BofA Securities provided its opinion to the Progenics Board (in its capacity as such) for the benefit and use of the Progenics Board in connection with and for purposes of its evaluation of the exchange ratio, taking into account the value of the CVR consideration, provided for in the merger, from a financial point of view. BofA Securities’ opinion does not address any other term, aspect or implication of the merger and no opinion or view was expressed as to the relative merits of the merger in comparison to other strategies or transactions that might be available to Progenics or in which Progenics might engage or as to the underlying business decision of Progenics to proceed with or effect the merger. BofA Securities also expressed no opinion or recommendation as to how any holder of Progenics common stock should vote or act in connection with the proposed merger or any other matter.



 

29


Table of Contents

Ownership of Lantheus Holdings Common Stock After the Merger (see page 91)

Lantheus Holdings expects to issue up to approximately 26,844,956 shares of its common stock to Progenics stockholders in the merger. The actual number of shares of Lantheus Holdings common stock to be issued pursuant to the merger will be determined at the completion of the merger based on the number of shares of Progenics common stock outstanding at such time. In addition, shares of Lantheus Holdings common stock may be issued from time to time following the effective time of the merger to holders of Progenics stock options on the terms set forth in the merger agreement. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of this joint proxy statement/prospectus for a more detailed explanation. Based on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding as of March 18, 2020, it is estimated that, immediately after the completion of the merger, Lantheus Holdings stockholders will own approximately 60% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding) and former Progenics stockholders will own approximately 40% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding). The exact equity stake of Lantheus Holdings stockholders and Progenics stockholders in the combined company immediately following the completion of the merger will depend on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding immediately prior to the merger.

Governance Matters Following Completion of the Merger (see page 184)

At the effective time of the merger, the Lantheus Holdings Board will appoint Dr. Gérard Ber and Heinz Mäusli to serve on the Lantheus Holdings Board as of the effective time of the merger. Lantheus Holdings has further agreed that the Lantheus Holdings Board, subject to their fiduciary duties, will use commercially reasonable efforts to cause Dr. Ber and Mr. Mäusli to be nominated for reelection following the closing of the merger through 2023. In addition, the Lantheus Holdings Board will be reduced in size from ten to nine members at Lantheus Holdings’ annual meeting of stockholders on April 23, 2020 (or sooner if the merger closes before then) and will be further reduced in size from nine to eight members prior to the date of Lantheus Holdings’ 2021 annual meeting of stockholders. The Lantheus Holdings Board will also take such actions as are necessary so that there are a total of nine members of the Lantheus Holdings Board as of the effective time of the merger. See “The Merger Agreement—Governance Matters Following Completion of the Merger” beginning on page 184 for further information.

Interests of Progenics’ Directors and Executive Officers in the Merger (see page 211)

In considering the recommendation of the Progenics Board to adopt the merger agreement, Progenics stockholders should be aware that Progenics’ directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of Progenics stockholders generally, including accelerated vesting of their Progenics stock options in the event of a qualifying termination of employment on or within 12 months following the merger), certain retention payments that may be made to Progenics’ executive officers (other than Mr. Mims and Patrick Fabbio, Senior Vice President and Chief Financial Officer of Progenics) in connection with the closing of the merger, and rights to ongoing indemnification and insurance coverage. In addition, pursuant to the merger agreement, at the effective time of the merger, the Lantheus Holdings Board will appoint Dr. Ber and Mr. Mäusli, who are currently members of the Progenics Board, to serve on the Lantheus Holdings Board. The Progenics Board was aware of these interests and considered them, among other matters, in evaluating and negotiating the merger agreement, in reaching its decision to approve the merger agreement and the transactions contemplated by the merger agreement, including the merger, and in recommending to Progenics stockholders that the merger agreement be adopted.

These interests are described in further detail under “Interests of Progenics’ Directors and Executive Officers in the Merger” and “The Merger Agreement—Indemnification and Insurance” beginning on pages 211 and 200, respectively, of this joint proxy statement/prospectus.



 

30


Table of Contents

Listing of Lantheus Holdings Common Stock; Delisting and Deregistration of Shares of Progenics Common Stock (see page 183)

The merger agreement obligates Lantheus Holdings to use its reasonable best efforts to cause the Lantheus Holdings common stock to be issued in the merger to be listed on the Nasdaq Global Market, subject to official notice of issuance, prior to the closing date of the merger. See “The Merger Agreement—Listing of Lantheus Holdings Common Stock” beginning on page 183 for further information. Approval for listing on the Nasdaq Global Market of the Lantheus Holdings common stock, subject to official notice of issuance, is a condition to the obligations of Progenics and Lantheus Holdings to complete the merger as described under “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 184 of this joint proxy statement/prospectus. If the merger is completed, shares of Progenics common stock will no longer be publicly traded, will be delisted from the Nasdaq Stock Market and will be deregistered under the Exchange Act, and Progenics will no longer be required to file period reports with the SEC.

Appraisal or Dissenters’ Rights Available to Progenics Stockholders (see page 166)

Under the DGCL, Progenics stockholders who do not vote in favor of the proposal to adopt the merger agreement will have the right to seek appraisal of, and receive payment in cash for, the “fair value” of their shares of Progenics common stock as determined by the Delaware Court of Chancery, together with interest, if any, as determined by the court, in lieu of the merger consideration but only if they fully comply with all of the applicable requirements of the DGCL. The following discussion is not a complete statement of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262, which is attached as Annex E to this joint proxy statement/prospectus. Strict compliance with the statutory procedures is required to perfect and preserve appraisal rights under Delaware law. Failure to timely and properly comply with the statutory requirements of Section 262 will result in the loss of appraisal rights under the DGCL. Because of the complexity of the procedures for exercising the right to seek appraisal of shares of Progenics common stock, stockholders considering exercising such rights are encouraged to seek the advice of legal counsel.

Progenics stockholders considering seeking appraisal should be aware that the “fair value” of their shares of Progenics common stock as determined by the Delaware Court of Chancery under Section 262 could be greater than, the same as or less than the merger consideration.

A stockholder wishing to exercise the right to seek an appraisal of his, her or its shares of Progenics common stock must, among other things, deliver to Progenics a written demand for appraisal of his, her or its shares before the vote with respect to the adoption of the merger agreement is taken, must not vote in favor of, or submit a blank proxy with respect to, the proposal to adopt the merger agreement and must continue to hold his, her or its shares of Progenics common stock from the date of making the demand through the effective time of the merger. The failure to follow the procedures specified under the DGCL will result in the loss of your appraisal rights.

The DGCL requirements for exercising appraisal rights are further described in the section entitled “Appraisal or Dissenters’ Rights for Progenics Stockholders” beginning on page 166 of this joint proxy statement/prospectus, and a copy of Section 262 is attached as Annex E to this joint proxy statement/prospectus. We encourage you to read these provisions carefully and in their entirety. If you hold your shares of Progenics common stock through a bank, brokerage firm or other nominee and you wish to exercise appraisal rights, you should consult with your bank, brokerage firm or other nominee to determine the appropriate procedures for the making of a demand for appraisal by such bank, brokerage firm or other nominee.

Completion of the Merger Is Subject to Certain Conditions (see page 184)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, the obligation of each of Lantheus Holdings and Merger Sub, on the one hand, and Progenics, on the other hand, to complete the



 

31


Table of Contents

merger is subject to the satisfaction or, to the extent permitted by applicable law, waiver of a number of conditions.

Mutual Conditions to Completion. The obligation of each of Progenics, Lantheus Holdings and Merger Sub to complete the merger is subject to the satisfaction or, to the extent permitted by applicable law, waiver on or prior to the closing date of the following conditions:

 

   

approval of the merger agreement proposal by the affirmative vote of the holders of at least a majority of the outstanding shares of Progenics common stock;

 

   

approval of the stock issuance proposal by the affirmative vote of the holders of at least a majority of the votes cast by the holders of outstanding shares of Lantheus Holdings common stock;

 

   

the absence of any law enacted or order issued by a governmental authority of competent jurisdiction having the effect of making the merger illegal or otherwise prohibiting completion of the merger;

 

   

effectiveness of the registration statement for the Lantheus Holdings common stock to be issued in the merger (of which this joint proxy statement/prospectus forms a part) and the absence of any stop order suspending the effectiveness or any proceedings for that purpose initiated or threatened by the SEC;

 

   

approval for listing on the Nasdaq Global Market of the Lantheus Holdings common stock to be issued in the merger and such other shares to be reserved for issuance in connection with the merger; and

 

   

any applicable waiting period (and any extension thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, which is referred to in this joint proxy statement/prospectus as the HSR Act, has expired or been terminated. Each of Lantheus Holdings and Progenics filed its respective HSR Act notification and report with respect to the merger on October 16, 2019. The United States Federal Trade Commission, which is referred to in this joint proxy statement/prospectus as the FTC, granted early termination of the HSR Act waiting period on October 25, 2019.

Additional Conditions to Completion for the Benefit of Lantheus Holdings and Merger Sub. In addition, the obligations of Lantheus Holdings and Merger Sub to complete the merger are subject to the satisfaction of, or waiver by Lantheus Holdings, on or prior to the closing date of the following conditions:

 

   

the accuracy of the representations and warranties of Progenics in the merger agreement as of the date of the original merger agreement (and, to the extent expressly provided therein, as of the date of the merger agreement) and as of the closing date (except to the extent in either case that such representations and warranties speak as of another date), subject to the applicable materiality standards set forth in the merger agreement and more fully described in “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 184 of this joint proxy statement/prospectus;

 

   

Progenics having performed or complied in all material respects with all agreements and covenants required to be performed by it under the merger agreement on or prior to the closing date;

 

   

the absence of any fact, circumstance, condition, development, change, event, occurrence or effect that has had or would reasonably be expected to have, individually or in the aggregate with all other facts, circumstances, conditions, developments, changes, events, occurrences or effects, a material adverse effect on Progenics since the date of the original merger agreement; and

 

   

Lantheus Holdings having received a certificate from the chief executive officer or the chief financial officer of Progenics confirming the satisfaction of the conditions described in the preceding three bullets.



 

32


Table of Contents

Additional Conditions to Completion for the Benefit of Progenics. In addition, the obligation of Progenics to complete the merger is subject to the satisfaction of the following conditions:

 

   

the accuracy of the representations and warranties of Lantheus Holdings and Merger Sub in the merger agreement as of the date of the original merger agreement (and, to the extent expressly provided therein, as of the date of the merger agreement) and as of the closing date (except to the extent in either case that such representations and warranties speak as of another date), subject to the applicable materiality standards set forth in the merger agreement and more fully described in “The Merger Agreement—Conditions to Completion of the Merger” beginning on page 184 of this joint proxy statement/prospectus;

 

   

each of Lantheus Holdings and Merger Sub having performed or complied in all material respects with all agreements and covenants required to be performed by it under the merger agreement on or prior to the closing date; and

 

   

Progenics having received a certificate from the chief executive officer or the chief financial officer of Lantheus Holdings confirming the satisfaction of the conditions described in the preceding two bullets.

Neither Lantheus Holdings nor Progenics can be certain when, or if, the conditions to the merger will be satisfied or waived, or that the merger will be completed.

The Merger May Not Be Completed Without the Required Regulatory Approvals (see page 164)

Completion of the merger is conditioned upon, among other things, the expiration or termination of the waiting period (and any extension thereof) applicable to the merger under the HSR Act, which has been obtained by grant of early termination of the HSR Act waiting period on October 25, 2019. Notwithstanding the grant of early termination, at any time before or after the merger is completed, the Antitrust Division of the United States Department of Justice, which is referred to in this joint proxy statement/prospectus as the Antitrust Division, the FTC, or U.S. state attorneys general could take action under the antitrust laws in opposition to the merger, including seeking to enjoin completion of the merger, condition completion of the merger upon the divestiture of assets, or impose restrictions on post-merger operations. Any such requirements or restrictions may prevent or delay completion of the merger or may reduce the anticipated benefits of the merger.

Lantheus Holdings and Progenics Expect the Merger to be Completed Early in the Second Quarter of 2020 (see page 19)

The merger is required to be completed three business days after the conditions to its completion have been satisfied or, to the extent permitted by applicable law, waived, unless otherwise mutually agreed by the parties.

As of the date of this joint proxy statement/prospectus, Lantheus Holdings and Progenics expect the merger to be completed early in the second quarter of 2020. However, there can be no assurance as to when, or if, the merger will be completed.

No Solicitation by Progenics or Lantheus Holdings (see page 193)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, and subject to the terms and conditions set forth in the merger agreement, each of Progenics and Lantheus Holdings has agreed not to, and not to authorize or permit any of its subsidiaries to, and each of Progenics and Lantheus Holdings will use its reasonable best efforts to cause its and its subsidiaries’ respective officers, directors, employees, accountants, counsel, financial advisors, consultants, financing sources and other advisors or representatives, which are collectively referred to in this joint proxy statement/prospectus as representatives, not to, directly or indirectly,



 

33


Table of Contents

(i) initiate or solicit or knowingly facilitate, knowingly induce or knowingly encourage any inquiry or the making of any proposal or offer that constitutes, or would reasonably be expected to lead to, a takeover proposal (as defined in “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus), (ii) enter into, continue or otherwise participate in any discussions or negotiations regarding, furnish to any person any information or data with respect to, or cooperate in any way that would otherwise reasonably be expected to lead to, any proposal or offer that constitutes, or would reasonably be expected to lead to, any takeover proposal, (iii) submit to the stockholders of Progenics or Lantheus Holdings, as applicable, for their approval or adoption any takeover proposal, or (iv) agree or publicly announce an intention to take any of the foregoing actions. Further, except as otherwise described in “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus, the Progenics Board or the Lantheus Holdings Board, as applicable, or any respective committee thereof, may not approve, declare advisable, adopt or recommend, or publicly propose to approve, declare advisable, adopt or recommend, or allow each of Progenics and Lantheus Holdings or its respective subsidiaries to execute or enter into any agreement that is intended to, or would reasonably be expected to lead to, any takeover proposal.

Each of Progenics and Lantheus Holdings has agreed to, and to cause its respective subsidiaries to, and to use reasonable best efforts to cause its and their respective representatives to, immediately cease and cause to be terminated any existing activities, discussions or negotiations with any persons conducted prior to the date of the merger agreement with respect to any takeover proposal and request the prompt return or destruction of any confidential information previously furnished to such persons in connection therewith and immediately terminate the access of each such person to any electronic data room maintained by or on behalf of each party or its subsidiaries. Progenics, Lantheus Holdings and their respective subsidiaries may not modify, amend or terminate, or waive, release, or fail to enforce or assign any provisions of, any confidentiality agreement (other than any standstill provision therein) to which it is a party relating to any takeover proposal or any inquiry, offer or proposal in connection therewith and will enforce, to the fullest extent permitted under applicable law, the provisions of any such agreement (other than any standstill provision therein).

Notwithstanding the foregoing, if at any time prior to the approval of the merger agreement proposal by Progenics stockholders, in the case of Progenics, or at any time prior to the approval of the stock issuance proposal by Lantheus Holdings stockholders, in the case of Lantheus Holdings, Progenics or Lantheus Holdings, as applicable, receives a bona fide written takeover proposal after the date of the merger agreement which was not solicited and has not resulted from a breach of the solicitation restrictions described in “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus, each of Progenics or Lantheus Holdings, as applicable, is permitted to:

 

   

furnish information with respect to Progenics or Lantheus Holdings, as applicable, and its respective subsidiaries to the person making such takeover proposal and its representatives pursuant to and in accordance with a confidentiality agreement containing provisions no less restrictive in any substantive respect than those contained in the confidentiality agreement between Progenics and Lantheus Holdings; except that such confidentiality agreement need not contain a standstill provision, so long as the information provided to such person has previously been provided or is provided to Progenics or Lantheus Holdings, as applicable, prior to or substantially concurrently with (and in any event on the same calendar day as) the time it is provided to such person; and

 

   

participate in discussions or negotiations with such person or its representatives regarding such takeover proposal.

However, Progenics and Lantheus Holdings may only take the actions described immediately above if the Progenics Board or the Lantheus Holdings Board, as applicable, determines in good faith (after consultation with its outside legal counsel and a financial advisor of nationally recognized reputation), that (i) after consultation with its outside legal counsel and a financial advisor of nationally recognized reputation, such takeover proposal



 

34


Table of Contents

is, or would reasonably be expected to lead to, a superior proposal, which is defined in “The Merger Agreement—No Solicitation” beginning on page 193 of this joint proxy statement/prospectus, and (ii) after consultation with its outside legal counsel, the failure to furnish such information or participate in such discussions or negotiations with respect to such takeover proposal would reasonably be expected to be inconsistent with its fiduciary duties under applicable law.

For more information on the solicitation restrictions binding on Progenics and Lantheus Holdings, see “The Merger Agreement—No Solicitation” beginning on page 193 of this joint proxy statement/prospectus.

Termination of the Merger Agreement (see page 205)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, and subject to the terms and conditions set forth in the merger agreement, the merger agreement may be terminated at any time before the effective time of the merger, whether before or after Progenics stockholders have approved the merger agreement proposal or Lantheus Holdings stockholders have approved the stock issuance proposal, in the following circumstances:

 

   

by mutual written consent of Lantheus Holdings and Progenics;

 

   

by either Lantheus Holdings or Progenics, if:

 

   

the merger has not been completed by July 1, 2020, which is referred to in this joint proxy statement/prospectus as an outside date termination event;

 

   

a governmental authority of competent jurisdiction has enacted a law or issued an order having the effect of making the merger illegal or otherwise prohibiting completion of the merger, in each case, that has become final and nonappealable;

 

   

Progenics stockholders fail to adopt the merger agreement upon a vote taken on the merger agreement proposal at the Progenics special meeting, which is referred to in this joint proxy statement/prospectus as a Progenics stockholder vote termination event; or

 

   

Lantheus Holdings stockholders fail to approve the stock issuance upon a vote taken on the stock issuance proposal at the Lantheus Holdings special meeting, which is referred to in this joint proxy statement/prospectus as a Lantheus Holdings stockholder vote termination event.

However, the right to terminate the merger agreement pursuant to the foregoing reasons will not be available to Progenics or Lantheus Holdings if that party’s failure to fulfill any obligation under the merger agreement has been the primary cause of, or directly resulted in, the failure of any such condition.

 

   

by Lantheus Holdings, if:

 

   

Progenics has breached or failed to perform any of its representations, warranties or covenants contained in the merger agreement, which breach or failure to perform would result in a failure to satisfy any condition to completion of the merger related to the accuracy of its representations and warranties or the performance of its covenants and agreements, and such breach is incapable of being cured by Progenics prior to July 1, 2020 or is not cured by the earlier of 30 days following written notice to Progenics by Lantheus Holdings of such breach and July 1, 2020, which is referred to in this joint proxy statement/prospectus as a Progenics breach termination event. However, the right to terminate the merger agreement in respect of an inaccuracy of any representation or warranty or the failure to perform any covenant or agreement will not be available to Lantheus Holdings or Merger Sub if Lantheus Holdings or Merger Sub is then in breach of its representations, warranties, covenants or agreements that would cause the applicable condition to completion of the merger related to accuracy of its representations and warranties or performance of its covenants and agreements not to be satisfied;



 

35


Table of Contents
   

Progenics or any of its subsidiaries or their respective representatives has willfully breached any of their respective obligations described under “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus, which is referred to in this joint proxy statement/prospectus as a Progenics solicitation termination event; or

 

   

the Progenics Board (i) fails to include its recommendation to stockholders of Progenics to adopt the merger agreement in this joint proxy statement/prospectus, (ii) makes a change in recommendation, (iii) makes any public recommendation in connection with a tender offer or exchange offer that is subject to Regulation 14D under the Exchange Act other than a recommendation in a Solicitation/Recommendation Statement on Schedule 14D-9 against such tender offer or exchange offer and other than a “stop, look and listen” notice of the type contemplated by Rule 14d-9(f) promulgated under the Exchange Act, or (iv) if a takeover proposal (other than a takeover proposal subject to Regulation 14D) has been publicly announced or disclosed (other than by Lantheus Holdings, its affiliates or its representatives), fails to recommend against such takeover proposal or fails to reaffirm its recommendation on or prior to the earlier of (A) 10 business days after such takeover proposal has been publicly announced or disclosed and (B) five business days prior to the Progenics special meeting, which is referred to in this joint proxy statement/prospectus, in any case of (i), (ii), (iii) or (iv), as a Progenics change in recommendation termination event. However, Lantheus Holdings will not have the right to terminate the merger agreement pursuant to clauses (i), (ii) or (iv) in this paragraph if Progenics stockholders have adopted the merger agreement at its special meeting.

 

   

by Progenics, if:

 

   

Lantheus Holdings or Merger Sub has breached or failed to perform any of its representations, warranties or covenants contained in the merger agreement, which breach or failure to perform would result in a failure to satisfy any condition to completion of the merger related to the accuracy of its representations and warranties or the performance of its covenants and agreements, and such breach is incapable of being cured by Lantheus Holdings or Merger Sub prior to July 1, 2020 or is not cured by the earlier of 30 days following written notice to Lantheus Holdings or Merger Sub by Progenics of such breach and July 1, 2020, which is referred to in this joint proxy statement/prospectus as a Lantheus Holdings breach termination event. However, the right to terminate the merger agreement in respect of an inaccuracy of any representation or warranty or the failure to perform any covenant or agreement will not be available to Progenics if Progenics is then in breach of its representations, warranties, covenants or agreements that would cause the applicable condition to completion of the merger related to accuracy of its representations and warranties or performance of its covenants and agreements not to be satisfied;

 

   

Lantheus Holdings or any of its subsidiaries or their respective representatives has willfully breached any of their respective obligations described under “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus of this joint proxy statement/prospectus, which is referred to in this joint proxy statement/prospectus as a Lantheus Holdings solicitation termination event; or

 

   

the Lantheus Holdings Board (i) fails to include its recommendation to stockholders of Lantheus Holdings to approve the stock issuance proposal in this joint proxy statement/prospectus, (ii) makes a change in recommendation, (iii) makes any public recommendation in connection with a tender offer or exchange offer that is subject to Regulation 14D under the Exchange Act other than a recommendation in a Solicitation/Recommendation Statement on Schedule 14D-9 against such tender offer or exchange offer and other than a “stop, look and listen” notice of the type contemplated by Rule 14d-9(f) promulgated under the Exchange Act, or (iv) if a takeover proposal (other than a takeover proposal subject to Regulation 14D) has been publicly announced or disclosed (other than by Progenics, its affiliates or its representatives), fails to recommend against such takeover proposal or fails to reaffirm its recommendation on or prior to the earlier of (A) 10 business days after such takeover proposal has been publicly announced or disclosed and



 

36


Table of Contents
 

(B) five business days prior to the Lantheus Holdings special meeting, which is referred to in this joint proxy statement/prospectus, in any case of (i), (ii), (iii) or (iv), as a Lantheus Holdings change in recommendation termination event. However, Progenics will not have the right to terminate the merger agreement pursuant to clauses (i), (ii) or (iv) in this paragraph if Lantheus Holdings stockholders has approved the stock issuance proposal at its special meeting.

Termination Fees and Expenses (see page 207)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, and subject to the terms and conditions set forth in the merger agreement, Progenics has agreed to pay Lantheus Holdings the Progenics termination fee of $18,340,000 if the merger agreement is terminated under any of the following circumstances (such fee only to be paid once):

 

   

a Progenics solicitation termination event;

 

   

a Progenics change in recommendation termination event;

 

   

a Progenics stockholder vote termination event if, at the time of such termination, Lantheus Holdings has the right to terminate the merger agreement pursuant to a Progenics solicitation termination event or a Progenics change in recommendation termination event; or

 

   

an outside date termination event, a Progenics breach termination event, or a Progenics stockholder vote termination event, if (i) in the case of an outside date termination event or a Progenics breach termination event, a takeover proposal shall have been made to the Progenics Board or become publicly known, and not withdrawn, prior to the date of such termination, or, in the case of a Progenics stockholder vote termination event, a takeover proposal shall have been made to the Progenics Board or become publicly known, and not publicly withdrawn, prior to the date of the Progenics special meeting, and (ii) in each case, within 12 months of such termination, Progenics enters into a definitive agreement with any third party to consummate, or consummates, a takeover proposal (where references to 15% in the definition of “takeover proposal” will be deemed to be references to 50%).

As more fully described in this joint proxy statement/prospectus and in the merger agreement, and subject to the terms and conditions set forth in the merger agreement, Lantheus Holdings has agreed to pay Progenics the Lantheus Holdings termination fee of $18,340,000 if the merger agreement is terminated under any of the following circumstances (such fee only to be paid once):

 

   

a Lantheus Holdings solicitation termination event;

 

   

a Lantheus Holdings change in recommendation termination event;

 

   

a Lantheus Holdings stockholder vote termination event if, at the time of such termination, Progenics has the right to terminate the merger agreement pursuant to a Lantheus Holdings solicitation termination event or a Lantheus Holdings change in recommendation termination event; or

 

   

an outside date termination event, a Lantheus Holdings breach termination event, or a Lantheus Holdings stockholder vote termination event, if (i) in the case of an outside date termination event or a Lantheus Holdings breach termination event, a takeover proposal shall have been made to the Lantheus Holdings Board or become publicly known, and not withdrawn, prior to the date of such termination, or, in the case of a Lantheus Holdings stockholder vote termination event, a takeover proposal shall have been made to the Lantheus Holdings Board or become publicly known, and not publicly withdrawn, prior to the date of the Lantheus Holdings special meeting and (ii) in each case, within 12 months of such termination, Lantheus Holdings enters into a definitive agreement with any third party to consummate, or consummates, a takeover proposal (where references to 15% in the definition of “takeover proposal” will be deemed to be references to 50%).

In the event that Progenics willfully breaches or fails to perform any of its covenants under the merger agreement, which breach or failure results in a material breach of the merger agreement (as finally determined by



 

37


Table of Contents

a court of competent jurisdiction), following any termination of the merger agreement, Progenics will pay to Lantheus Holdings damages of $18,340,000, which is referred to in this joint proxy statement/prospectus as the willful breach damages payment. However, Progenics will not be required to pay the willful breach damages payment if it has already paid the Progenics termination fee.

If a Progenics stockholder vote termination event occurs and Lantheus Holdings is not otherwise entitled to the Progenics termination fee described under this section, then Progenics will pay to Lantheus Holdings the amount equal to the reasonable and documented out-of-pocket expenses incurred by Lantheus Holdings, Merger Sub and the other Lantheus Holdings subsidiaries in connection with the merger, such amount not to exceed $5,240,000, which is referred to in this joint proxy statement/prospectus as the Lantheus Holdings expense reimbursement. If Progenics has reimbursed Lantheus Holdings for such expenses, a subsequent payment of the Progenics termination fee or the willful breach damages payment will be net of the amount of such expenses previously paid by Progenics.

See “The Merger Agreement—Termination Fees and Expenses” beginning on page 207 of this joint proxy statement/prospectus for a more complete description of the circumstances under which Progenics or Lantheus Holdings will be required to pay a termination fee, willful breach damages payment or expense reimbursement.

Enforcement (see page 208)

Under the merger agreement, each of Lantheus Holdings and Progenics is entitled to an injunction or injunctions to prevent breaches of the merger agreement and to enforce specifically the terms and provisions of the merger agreement in any court of competent jurisdiction. The right of specific enforcement is an integral part of the transactions and without that right, neither Lantheus Holdings nor Progenics would have entered into the merger agreement.

Material U.S. Federal Income Tax Consequences (see page 170)

As of the date hereof, the merger is intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and, for U.S. federal income tax purposes, generally, no gain or loss is intended to be recognized by the Progenics stockholders to the extent the Progenics stockholders receive shares of Lantheus Holdings common stock in exchange for shares of Progenics common stock. Subject to the qualifications, exceptions, assumptions and limitations contained in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus, if the merger qualifies as a “reorganization” within the meaning of Section 368(a) of the Code, then, for U.S. federal income tax purposes, generally, gain will be recognized by a U.S. holder (as defined in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences”) of Progenics common stock equal to the lesser of (i) the sum of the cash received in lieu of fractional shares and the fair market value of the CVRs received as determined for U.S. federal income tax purposes and (ii) the difference, if any, between (x) the sum of the fair market values of the Lantheus Holdings common stock and the CVRs, as determined for U.S. federal income tax purposes, and the cash received in lieu of fractional shares and (y) such holder’s adjusted tax basis in the Progenics common stock surrendered. The tax treatment of the receipt of the CVRs and payments thereunder is uncertain, and the alternative treatments are described in the section entitled “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences”.

Subject to the qualifications, exceptions, assumptions and limitations contained in “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus, if the merger does not qualify as a “reorganization” under Section 368(a) of the Code, then, for U.S. federal income tax purposes, a U.S. holder of Progenics common stock would recognize gain or loss in an amount equal to the



 

38


Table of Contents

difference, if any, between (i) the sum of the fair market values of the Lantheus Holdings common stock and the CVRs, as determined for U.S. federal income tax purposes, and any cash received in lieu of fractional shares and (ii) such holder’s adjusted tax basis in the Progenics common stock surrendered.

Each Progenics stockholder is urged to read the discussion in the section entitled “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus and to consult its tax advisor to determine the particular U.S. federal, state or local or non-U.S. income or other tax consequences to it of the merger.

Accounting Treatment (see page 176)

The unaudited pro forma condensed combined financial statements have been prepared using the acquisition method of accounting under Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”) with Lantheus Holdings being the accounting acquirer in the proposed merger with Progenics. Lantheus Holdings will record certain Progenics assets to be acquired and liabilities to be assumed at fair market value at the date of completion of the merger. Any excess of the purchase price (as described under “Note 5. Estimate of consideration expected to be transferred in the merger and preliminary purchase price allocation” under “Notes to the Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 63 of this joint proxy statement/prospectus) over the net fair value of such assets and liabilities will be recorded as goodwill.

Rights of Progenics Stockholders Will Change as a Result of the Merger (see page 235)

Progenics stockholders will have different rights once they become Lantheus Holdings stockholders due to differences between the organizational documents of Lantheus Holdings and Progenics. These differences are described in more detail under “Comparison of Stockholder Rights” beginning on page 235 of this joint proxy statement/prospectus.

Litigation Relating to the Merger (see page 177)

Six securities class action lawsuits were initially brought against Progenics and the Progenics Board alleging inadequate disclosure by Progenics in the registration statement filed on November 12, 2019 related to the merger. Three of such lawsuits were voluntarily dismissed without prejudice by plaintiffs, with no settlements from, or other agreed obligations by, the respective defendants thereunder.

On November 22, 2019, a purported stockholder filed a putative class action complaint in the United States District Court for the District of Delaware, captioned Johnson v. Progenics Pharmaceuticals, Inc., et al., Civil Action No. 1:19-cv-02183, against Progenics and members of the Progenics Board, which is referred to in this joint proxy statement/prospectus as the Johnson Action. On March 5, 2020, the Johnson Action was voluntarily dismissed without prejudice. On November 25, 2019, a second purported stockholder filed a putative class action complaint in the United States District Court for the District of Delaware, captioned Thompson v. Progenics Pharmaceuticals, Inc., et al., Civil Action No. 1:19-cv-02194, against Progenics, certain members of the Progenics Board, Lantheus Holdings, and Merger Sub, which is referred to in this joint proxy statement/prospectus as the Thompson Action. On March 10, 2020, the Thompson Action was voluntarily dismissed without prejudice. On November 26, 2019, a third purported stockholder filed a complaint in the United States District Court for the Southern District of New York, captioned Wang v. Progenics Pharmaceuticals, Inc., et al., Civil Action No. 1:19-cv-10936, against Progenics and members of the Progenics Board, which is referred to in this joint proxy statement/prospectus as the Wang Action. On December 9, 2019, a fourth purported stockholder filed a putative class action complaint in the United States District Court for the District of New Jersey, captioned Michael A. Bernstein IRA v. Progenics Pharmaceuticals, Inc. et al., Civil Action No. 2:19-cv-21200, against Progenics, members of the Progenics Board, Lantheus Holdings, and Merger Sub, which is referred to in this joint proxy statement/prospectus as the Bernstein IRA Action. On December 12, 2019, a fifth purported



 

39


Table of Contents

stockholder filed a putative class action complaint in the United States District Court for the District of Delaware, captioned Pill v. Progenics Pharmaceuticals, Inc., et al., Civil Action No. 1:19-cv-02268, against Progenics and members of the Progenics Board, which is referred to in this joint proxy statement/prospectus as the Pill Action. The purported stockholder voluntarily dismissed this action without prejudice and the court closed the case on March 10, 2020. On December 20, 2019, a sixth purported stockholder filed a complaint in the United States District Court for the Southern District of New York, captioned Hess v. Progenics Pharmaceuticals, Inc., et al., Civil Action No. 1:19-cv-11683, against Progenics, Progenics’ Chief Executive Officer and Chief Financial Officer, and members of the Progenics Board, which is referred to in this joint proxy statement/prospectus as the Hess Action.

The complaints in the Wang, Bernstein IRA and Hess Actions allege, among other things, that Progenics and the members of the Progenics Board violated Sections 14(a) and 20(a) of the Exchange Act, and 17 C.F.R. § 244.100 and Rule 14a-9 promulgated under the Exchange Act, by misstating or omitting certain allegedly material information in the registration statement filed with the SEC on November 12, 2019 related to the merger. The Bernstein IRA Action also alleges that Lantheus Holdings and Merger Sub violated Section 20(a) of the Exchange Act. The complaints seek, among other things, injunctive relief preventing the consummation of the merger, damages in the event of consummation of the merger, declaratory relief related to disclosures in the registration statement, and certain fees and expenses. Progenics intends to vigorously defend itself against these complaints.

In addition, by letter dated October 14, 2019, Progenics received a shareholder demand from the Fireman’s Retirement System of St. Louis, which is referred to in this joint proxy/statement as the FRS demand, under Section 220 of the DGCL to inspect its books and records concerning, among other things, the opposition to the consent solicitation commenced by Velan and the negotiation and execution of the original merger agreement, and asserting that the Progenics Board may have breached its fiduciary obligations. Progenics and Fireman’s Retirement System of St. Louis executed a confidentiality agreement and negotiated the scope of the production of books and records in response to the FRS demand, which Progenics has provided.

Risk Factors (see page 41)

You should also carefully consider the risks that are described in the section entitled “Risk Factors” beginning on page 41 of this joint proxy statement/prospectus.



 

40


Table of Contents

RISK FACTORS

In addition to the other information contained or incorporated by reference into this joint proxy statement/prospectus, including the matters addressed in “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 74 of this joint proxy statement/prospectus, you should carefully consider the following risk factors in determining whether to vote for the merger agreement proposal or the stock issuance proposal, as applicable. You also should read and consider the risk factors associated with each of the businesses of Lantheus Holdings and Progenics because these risk factors may affect the operations and financial results of the combined company. These risks may be found under Part I, Item 1A, “Risk Factors” in each company’s Annual Report on Form 10-K for the year ended December 31, 2019 and future filings with the SEC, each of which is on file or will be filed with the SEC and all of which are incorporated by reference into this joint proxy statement/prospectus.

Risks Related to the Merger

Because the exchange ratio is fixed and will not be adjusted in the event of any changes in either Lantheus Holdings’ or Progenics’ stock price, and because of the uncertainty of the fair market value of, and the ultimate realization on, the CVRs, Progenics stockholders cannot be sure of the value of the merger consideration they will receive in the merger.

Upon completion of the merger, each share of Progenics common stock outstanding immediately prior to the completion of the merger (other than excluded shares and dissenting shares) will be converted into the right to receive 0.31 of a share of Lantheus Holdings common stock without interest and one CVR representing the right to receive, subject to the CVR cap, such stockholder’s pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyL in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively, as set forth in the CVR agreement. The exchange ratio is fixed and will not be adjusted for changes in the market price of either Lantheus Holdings common stock or Progenics common stock between the date the merger agreement was signed and completion of the merger. As a result, changes in the price of Lantheus Holdings common stock prior to the completion of the merger will affect the value of the Lantheus Holdings common stock that Progenics stockholders will receive upon completion of the merger.

The market price of shares of Lantheus Holdings common stock has fluctuated since the date of the announcement of the merger agreement and may continue to change through the date of each of the Lantheus Holdings and the Progenics special meetings and the date the merger is completed. For example, based on the range of closing prices of Lantheus Holdings common stock during the period from February 19, 2020, the last full trading day before the public announcement of the merger, through March 18, 2020, the latest practicable trading date before the date of this joint proxy statement/prospectus, the exchange ratio resulted in an implied value of the stock consideration ranging from a high of approximately $5.17 to a low of approximately $2.82 for each share of Progenics common stock. The actual market value of the Lantheus Holdings common stock received by holders of Progenics common stock may result in an implied value of the stock consideration outside this range. There is also uncertainty regarding the fair market value of the CVRs and whether any payment will ultimately be realized on the CVRs.

Stock price changes may result from a variety of factors, including, among others, general market and economic conditions, changes in Lantheus Holdings’ and Progenics’ respective businesses, operations and prospects, risks inherent in their respective businesses, changes in market assessments of the likelihood that the merger will be completed and/or the value that may be generated by the merger, and changes with respect to expectations regarding the timing of the merger and regulatory considerations. At the time of the Progenics special meeting, Progenics stockholders will not know with certainty the value of the shares of Lantheus Holdings common stock that they will receive upon completion of the merger.

 

41


Table of Contents

The merger is subject to the expiration or termination of applicable waiting periods and the receipt of approvals, consents or clearances from regulatory authorities that may impose conditions that could have an adverse effect on Lantheus Holdings, Progenics or the combined company or, if not obtained, could prevent completion of the merger.

Before the merger may be completed, any approvals, consents or clearances required in connection with the merger must have been obtained, in each case, under applicable law. Completion of the merger is conditioned upon, among other things, the expiration or termination of the waiting period (and any extension thereof) applicable to the merger under the HSR Act, which, as noted above, has been obtained by grant of early termination of the HSR Act waiting period on October 25, 2019. Notwithstanding the grant of early termination, at any time before or after the merger is completed, the Antitrust Division, the FTC, or U.S. state attorneys general could take action under the antitrust laws in opposition to the merger, including seeking to enjoin completion of the merger, condition completion of the merger upon the divestiture of assets, or impose restrictions on post-merger operations. Any such requirements or restrictions may prevent or delay completion of the merger or may reduce the anticipated benefits of the merger.

The merger is subject to conditions, some or all of which may not be satisfied, or completed on a timely basis, if at all. Failure to complete the merger could have material adverse effects on Lantheus Holdings’ and Progenics’ businesses.

The completion of the merger is subject to a number of conditions in addition to the termination or expiration of any applicable waiting period (and any extension thereof) under the HSR Act, including, among other conditions: (i) approval of the merger agreement proposal by Progenics stockholders at the Progenics special meeting; (ii) approval of the stock issuance proposal by Lantheus Holdings stockholders at the Lantheus Holdings special meeting; (iii) approval for the listing on the Nasdaq Global Market of the shares of Lantheus Holdings common stock to be issued in the merger and such other shares to be reserved for issuance in connection with the merger; (iv) the absence of any law enacted or order issued by a governmental authority of competent jurisdiction having the effect of making the merger illegal or otherwise prohibiting completion of the merger; (v) the accuracy of the representations and warranties made in the merger agreement by the other party, subject to the applicable materiality standards set forth in the merger agreement; (vi) the absence of any fact, circumstance, condition, development, change, event, occurrence or effect that has had or would reasonably be expected to have, individually or in the aggregate with all other facts, circumstances, conditions, developments, changes, events, occurrences or effects, a material adverse effect on Progenics since the date of the original merger agreement; (vii) performance or compliance in all material respects by the other party with all the agreements and covenants required to be performed by such party under the merger agreement on or prior to the closing date; and (viii) the effectiveness of the registration statement on Form S-4 relating to the merger and no stop order suspending the effectiveness of the registration statement and no proceedings for such purpose initiated or threatened by the SEC.

In addition, the merger agreement contains certain termination rights for both Lantheus Holdings and Progenics, including, among other things, (i) if the merger has not been completed by July 1, 2020, (ii) if the required approval of Lantheus Holdings stockholders or the Progenics stockholders is not obtained, (iii) if the other party willfully breaches its non-solicitation obligations in the merger agreement, (v) if the other party materially breaches its representations, warranties or covenants which breach or failure to perform would result in a failure to satisfy any condition to completion of the merger related to the accuracy of its representations and warranties or the performance of its covenants and agreements, and fails to cure such breach, (vi) if any law or order prohibiting the merger or the stock issuance has become final and nonappealable, or (vii) if the board of directors of the other party changes its recommendation in connection with the merger. If the merger is not completed, the ongoing business of Lantheus Holdings and Progenics may be materially adversely affected and, without realizing any of the benefits that they could have realized had the merger been completed, they will be subject to a number of risks, including the following:

 

   

Lantheus Holdings and Progenics may experience negative reactions from the financial markets, including negative impacts on trading prices of Lantheus Holdings common stock and Progenics common stock, and from their respective customers, vendors, regulators and employees;

 

42


Table of Contents
   

Progenics may be required to pay Lantheus Holdings a termination fee of $18,340,000 if the merger agreement is terminated under certain circumstances, and Lantheus Holdings may be required to pay Progenics a termination fee of $18,340,000 if the merger agreement is terminated under certain other circumstances (see “The Merger Agreement—Termination Fees and Expenses” beginning on page 207 of this joint proxy statement/prospectus);

 

   

if the merger agreement is terminated and the Lantheus Holdings Board or the Progenics Board seeks another business combination, Lantheus Holdings stockholders and Progenics stockholders cannot be certain that Lantheus Holdings or Progenics will be able to find a party willing to enter into a transaction on terms equivalent to or more attractive than the terms that the other party has agreed to in the merger agreement;

 

   

Lantheus Holdings and Progenics will be required to pay certain transaction expenses and other costs incurred in connection with the merger, whether or not the merger is completed, including regulatory filings and legal, accounting, certain financial advisory, consulting and other advisory expenses, employee benefit-related expenses and filing and printing fees, and for Progenics, in certain circumstances, certain fees and expenses of Lantheus Holdings in connection with the Lantheus Holdings expense reimbursement (see “The Merger Agreement—Termination Fees and Expenses” beginning on page 207 of this joint proxy statement/prospectus); and

 

   

matters relating to the merger (including arranging integration planning) will require substantial commitments of time and resources by Lantheus Holdings and Progenics management and the expenditure of significant funds in the form of fees and expenses, which would otherwise have been devoted to day-to-day operations and other opportunities that may have been beneficial to either Lantheus Holdings or Progenics as an independent company.

In addition, if the merger is not completed, Lantheus Holdings and Progenics could be subject to litigation related to any failure to complete the merger or related to any enforcement proceeding commenced against either Lantheus Holdings or Progenics to perform its obligations under the merger agreement. If any such risk materializes, it could adversely impact either Lantheus Holdings’ or Progenics’ ongoing business. Similarly, delays in the completion of the merger could, among other things, result in additional transaction costs, loss of revenue or other negative effects associated with uncertainty about completion of the merger and cause them not to realize some or all of the benefits that they expect to achieve if the merger is successfully completed within its expected timeframe. We cannot assure you that the conditions to the closing of the merger will be satisfied or waived or that the merger will be completed.

In addition, Progenics anticipates it being necessary to obtain additional financing in order to meet its cash requirements if the merger is not consummated. However, there can be no assurances that Progenics will be able to obtain additional capital on acceptable terms and in the amounts necessary to fully fund Progenics’ current operating expenses or reduced operating expenses reflecting delays or reductions in the scope of Progenics’ product development programs beyond 2020. These and other circumstances raise substantial doubt about Progenics’ ability to continue as a going concern if the merger is not consummated. Progenics’ independent registered public accounting firm has issued an opinion on Progenics’ financial statements as of and for the period ended December 31, 2019 included in Progenics’ Annual Report on Form 10-K, and incorporated by reference in this joint proxy statement/prospectus, that states that there is substantial doubt about Progenics’ ability to continue as a going concern and that the financial statements do not include any adjustments relating to the recoverability and classification of liabilities that might be necessary should Progenics be unable to continue as a going concern.

On March 15, 2020, Progenics, as borrower, and Lantheus Medical Imaging, as lender, entered into a bridge loan agreement, pursuant to which Lantheus Medical Imaging agreed to provide for a secured short-term loan to Progenics on or after May 1, 2020 in an aggregate principal amount of up to $10 million. The bridge loan matures on the earlier to occur of (a) September 30, 2020 and (b) the date on which Progenics enters into a debt

 

43


Table of Contents

financing or similar arrangements or any amendment to, or replacement of, its existing debt provided by one or more third parties following the termination date of the merger agreement, in either case, having aggregate net cash proceeds that exceed the amount then required to repay all obligations under the bridge loan agreement in full in cash. If such bridge loan is made by Lantheus Medical Imaging, there is no assurance that such borrowings will be repaid in accordance with the terms of the bridge loan agreement, or at all. See “Bridge Loan Agreement” beginning on page 210 of this joint proxy statement/prospectus for a more detailed description of the bridge loan agreement.

Uncertainties associated with the merger may cause a loss of management personnel and other key employees, and Lantheus Holdings and Progenics may have difficulty attracting and motivating management personnel and other key employees, which could adversely affect the future business and operations of the combined company.

Lantheus Holdings and Progenics are each dependent on the experience and industry knowledge of their respective management personnel and other key employees to execute their business plans. The combined company’s success after the completion of the merger will depend in part upon the ability of each of Lantheus Holdings and Progenics to attract, motivate and retain key management personnel and other key employees. Prior to completion of the merger, current and prospective employees of each of Lantheus Holdings and Progenics may experience uncertainty about their roles within the combined company following the completion of the merger, which may have an adverse effect on the ability of each of Lantheus Holdings and Progenics to attract, motivate or retain management personnel and other key employees. In addition, no assurance can be given that the combined company will be able to attract, motivate or retain management personnel and other key employees of each of Lantheus Holdings and Progenics to the same extent that Lantheus Holdings and Progenics have previously been able to attract or retain their own employees.

On February 28, 2020, Mr. Fabbio provided notice to the Progenics Board of his intention to resign as Progenics’ Chief Financial Officer, effective March 27, 2020. Mr. Fabbio has agreed to continue providing services to Progenics as a consultant following the effective date of his resignation until the earlier of the effective time of the merger and May 15, 2020 unless terminated by either party as set forth therein, as further described in the section entitled “Interests of Progenics’ Directors and Executive Officers in the Merger” beginning on page 211 of this joint proxy statement/prospectus.

Progenics’ executive officers and directors have interests in the merger that may be different from your interests as a stockholder of Progenics.

When considering the recommendation of the Progenics Board that Progenics stockholders vote in favor of the merger agreement proposal, the Progenics adjournment proposal and the compensation advisory proposal, Progenics stockholders should be aware that Progenics’ directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of Progenics stockholders generally, including accelerated vesting of their Progenics stock options in connection with the merger (or, in the case of executive officers, a qualifying termination of employment on or within 12 months following the merger), certain retention payments that may be made to Progenics’ executive officers (other than Mr. Mims and Mr. Fabbio) in connection with the closing of the merger, and rights to ongoing indemnification and insurance coverage in accordance with the terms of certain indemnification agreements. In addition, pursuant to the merger agreement, at the effective time of the merger, the Lantheus Holdings Board will appoint Dr. Ber and Mr. Mäusli, who are currently members of the Progenics Board, to serve on the Lantheus Holdings Board. See “Interests of Progenics’ Directors and Executive Officers in the Merger” beginning on page 211 of this joint proxy statement/prospectus for a more detailed description of these interests. The Progenics Board and the Lantheus Holdings Board were aware of these interests and considered them, in addition to other matters, in evaluating, negotiating and approving the merger agreement and in recommending that Progenics stockholders adopt the merger agreement and that the Lantheus Holdings stockholders approve the stock issuance, respectively.

 

44


Table of Contents

The merger agreement limits the ability of both Lantheus Holdings and Progenics to pursue alternatives to the merger and may discourage other companies from trying to acquire either Lantheus Holdings or Progenics.

The merger agreement contains a no solicitation covenant that restricts both Lantheus Holdings’ and Progenics’ ability to (i) initiate or solicit or knowingly facilitate, knowingly induce or knowingly encourage any inquiry or the making of any proposal or offer that constitutes, or would reasonably be expected to lead to, a takeover proposal (as defined in “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus), (ii) enter into, continue or otherwise participate in any discussions or negotiations regarding, furnish to any person any information or data with respect to, or cooperate in any way that would otherwise reasonably be expected to lead to, any proposal or offer that constitutes, or would reasonably be expected to lead to, any takeover proposal, (iii) submit to the stockholders of Progenics or Lantheus Holdings, as applicable, for their approval or adoption any takeover proposal, or (iv) agree or publicly announce an intention to take any of the foregoing actions. In the event either company receives a bona fide written takeover proposal, it must promptly communicate the receipt of such proposal and provide copies of all written materials provided, including the terms and conditions of such proposal, to the other party. If, in response to such proposals and subject to certain conditions, either company intends to effect a change in recommendation of its board of directors (as defined in “The Merger Agreement—No Solicitation,” beginning on page 193 of this joint proxy statement/prospectus), it must engage in good faith negotiations with the other party to amend the merger agreement in response to such competing takeover proposal before its board may make a change in recommendation. The merger agreement further provides that in the event of a termination of the merger agreement under certain specified circumstances, including a termination following a change in recommendation by the board of directors of either party or a willful breach of the no solicitation provision applicable to it, such party may be required to pay the other party a termination fee equal to $18,340,000 (see “The Merger Agreement—Termination Fees and Expenses” beginning on page 207 of this joint proxy statement/prospectus).

These provisions could discourage a potential third-party acquirer that might have an interest in acquiring all or a significant portion of Lantheus Holdings or Progenics from considering or proposing that acquisition, even if that party were prepared to pay consideration with a higher per-share value than the currently proposed merger consideration, in the case of Progenics, or that party were prepared to enter into an agreement that may be favorable to Lantheus Holdings or its stockholders, in the case of Lantheus Holdings. These provisions might also result in a potential third-party acquirer proposing to pay a lower price in a takeover proposal than it might otherwise have proposed to pay because of the added expense of the termination fee and other fees and expenses that may become payable in certain circumstances.

The shares of Lantheus Holdings common stock to be received by Progenics stockholders upon completion of the merger will have different rights from shares of Progenics common stock.

Upon completion of the merger, Progenics stockholders will no longer be stockholders of Progenics, but will instead become stockholders of Lantheus Holdings, and their rights as Lantheus Holdings stockholders will be governed by the terms of Lantheus Holdings’ amended and restated certificate of incorporation, as it may be amended from time to time, which is referred to in this joint proxy statement/prospectus as Lantheus Holdings’ certificate of incorporation, and Lantheus Holdings’ amended and restated by-laws, as they may be amended from time to time, which are referred to in this joint proxy statement/prospectus as Lantheus Holdings’ by-laws. The terms of Lantheus Holdings’ certificate of incorporation and Lantheus Holdings’ by-laws are in some respects materially different than the terms of Progenics’ amended and restated certificate of incorporation, as it may be amended from time to time, which is referred to in this joint proxy statement/prospectus as Progenics’ certificate of incorporation, and Progenics’ by-laws, as they may be amended from time to time, which are referred to in this joint proxy statement/prospectus as Progenics’ by-laws, which currently govern the rights of Progenics stockholders. See “Comparison of Stockholder Rights” beginning on page 235 of this joint proxy statement/prospectus for a discussion of the different rights associated with shares of Progenics common stock and shares of Lantheus Holdings common stock.

 

45


Table of Contents

Lantheus Holdings and Progenics may be targets of securities class action and derivative lawsuits that could result in substantial costs and may delay or prevent the merger from being completed.

Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into merger agreements. As of March 18, 2020, six securities class action lawsuits were initially brought against Progenics and the Progenics Board alleging inadequate disclosure by Progenics in the registration statement filed on November 12, 2019 related to the merger. Three of such lawsuits were voluntarily dismissed without prejudice by plaintiffs, with no settlements from, or other agreed obligations by, the respective defendants thereunder. One of those lawsuits against Progenics that has not been dismissed also names Lantheus Holdings or one of its affiliates as defendants. In addition, by letter dated October 14, 2019, Progenics received the FRS demand under Section 220 of the DGCL to inspect its books and records concerning, among other things, the opposition to the consent solicitation commenced by Velan and the negotiation and execution of the original merger agreement, and asserting that the Progenics Board may have breached its fiduciary obligations. Lantheus Holdings and Progenics do not believe that these lawsuits have merit or will result in any material monetary damages payable by either Lantheus Holdings or Progenics. However, even if lawsuits are without merit, defending against any legal claims can result in substantial costs and divert management time and resources. An adverse judgment in a securities class action lawsuit or derivative lawsuit alleging significant monetary loss by the plaintiffs could result in monetary damages for Lantheus Holdings and Progenics, which could have a negative impact on Lantheus Holdings’ and Progenics’ respective liquidity and financial condition. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting completion of the merger, then that injunction may delay or prevent the merger from being completed, or from being completed within the expected timeframe, which may adversely affect Lantheus Holdings’ and Progenics’ respective business, financial position and results of operation. See “—Background of the Merger and Certain Other Developments” beginning on page 91 of this joint proxy statement/prospectus.

Lantheus Holdings and Progenics are each subject to business uncertainties and contractual restrictions while the merger is pending, which could adversely affect the business and operations of Lantheus Holdings, Progenics or the combined company.

In connection with the pendency of the merger, it is possible that some customers, suppliers and other persons with whom Lantheus Holdings or Progenics has a business relationship may delay or defer certain business decisions or might decide to seek to terminate, change or renegotiate their relationships with Lantheus Holdings or Progenics, as the case may be, as a result of the merger, which could negatively affect Lantheus Holdings’ or Progenics’ current, or the combined company’s future, revenues, earnings and cash flows, as well as the market price of Lantheus Holdings or Progenics common stock, regardless of whether the merger is completed. Under the terms of the merger agreement, Lantheus Holdings and Progenics are each subject to certain restrictions on the conduct of its business prior to completing the merger, which could adversely affect each party’s ability to execute certain of its business strategies. Such limitations could adversely affect each party’s business and operations prior to the completion of the merger. Each of the risks described above may be exacerbated by delays or other adverse developments with respect to the completion of the merger.

The unaudited pro forma combined financial information and prospective financial information included in this joint proxy statement/prospectus are presented for illustrative purposes only and do not represent the actual financial position or results of operations of the combined company following completion of the merger.

The unaudited pro forma combined financial information and prospective financial information contained in this joint proxy statement/prospectus is presented for illustrative purposes only, contains a variety of adjustments, assumptions and preliminary estimates and does not represent the actual financial position or results of operations of Lantheus Holdings and Progenics prior to the merger or that of the combined company following the merger for several reasons. Among other things, the unaudited pro forma combined financial information does not reflect the projected realization of cost savings following completion of the merger. See the sections entitled “Certain Unaudited Pro Forma Condensed Combined Financial Statements,” “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Certain Unaudited Prospective Financial Information” and

 

46


Table of Contents

“Comparative Historical and Unaudited Pro Forma Combined Per Share Data” beginning on pages 59, 157 and 57, respectively, of this joint proxy statement/prospectus.

The actual financial positions and results of operations of Lantheus Holdings and Progenics prior to the merger and that of the combined company following the merger may not be consistent with, or evident from, and may differ materially and adversely from, the unaudited pro forma combined financial information or prospective financial information included in this joint proxy statement/prospectus. In addition, the assumptions used in preparing the unaudited pro forma combined financial information and/or the prospective financial information included in this joint proxy statement/prospectus may not be realized, may not prove to be accurate and may be affected by other factors, which could lead to material changes to the combined company’s business that are not reflected in the unaudited pro forma combined financial information.

The opinions of Progenics’ and Lantheus Holdings’ respective financial advisors do not reflect changes in circumstances that may have occurred or that may occur between the signing of the merger agreement and the completion of the merger.

Neither the Progenics Board nor the Lantheus Holdings Board has obtained updated opinions from their respective financial advisors as of the date of this joint proxy statement/prospectus, nor do either of them expect to receive updated, revised or reaffirmed opinions prior to the completion of the merger. Changes in the operations and prospects of Progenics or Lantheus Holdings, general market and economic conditions and other factors that may be beyond the control of Progenics or Lantheus Holdings, and on which Progenics’ and Lantheus Holdings’ financial advisors’ opinions were based, may significantly alter the value of Progenics or Lantheus Holdings or the share prices of Progenics common stock or Lantheus Holdings common stock by the time the merger is completed. The opinions do not speak as of the time the merger will be completed or as of any date other than the date of such opinions. Because Progenics’ and Lantheus Holdings’ financial advisors will not be updating their opinions, the opinions will not address the fairness of the merger consideration from a financial point of view at the time the merger is completed. The Lantheus Holdings Board’s recommendation that Lantheus Holdings stockholders approve the stock issuance proposal and the Progenics Board’s recommendation that Progenics stockholders approve the merger agreement proposal, however, are made as of the date of this joint proxy statement/prospectus. For a description of the opinions that the Progenics Board and the Lantheus Holdings Board received from their respective financial advisors, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Opinion of Lantheus Holdings’ Financial Advisor” and “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Opinion of Progenics’ Financial Advisor” beginning on pages 140 and 148, respectively, of this joint proxy statement/prospectus.

The merger may not occur, and if it does, it may not be accretive and may cause dilution to Lantheus Holdings earnings per share, which may negatively affect the market price of its common stock.

Although it is currently anticipated that the merger will occur and will be accretive to Lantheus Holdings’ adjusted earnings per share by 2022 and GAAP-reported earnings per share by 2023, these expectations are based on assumptions about Lantheus Holdings’ and Progenics’ business and preliminary estimates, which may change materially. Certain other expenses to be paid in connection with the merger may cause dilution to Lantheus Holdings’ earnings per share or decrease or delay the expected accretive effect of the merger and could cause a decrease in the market price of the Lantheus Holdings common stock. In addition, the merger may not occur or Lantheus Holdings could encounter additional transaction-related costs or other factors such as the failure to realize all of the benefits anticipated in the merger, including synergies, cost savings, innovation and operational efficiencies and revenue growth from the combination. All of these factors could cause dilution to Lantheus Holdings’ earnings per share or decrease or delay the expected accretive effect of the merger and cause a decrease in the market price of Lantheus Holdings common stock.

 

47


Table of Contents

Progenics stockholders have appraisal rights under Delaware law.

Under Delaware law, Progenics stockholders who do not vote in favor of adoption of the merger agreement and who otherwise properly perfect their rights will be entitled to “appraisal rights” in connection with the proposed merger, which generally entitle Progenics stockholders to receive, in lieu of the merger consideration, a cash payment of an amount determined by the Delaware Court of Chancery to be equal to the fair value of their Progenics common stock as of the effective time of the merger. The appraised value would be determined by the Court of Chancery and could be less than, the same as, or more than the merger consideration. Under Delaware law, stockholders are generally entitled to statutory interest on an appraisal award at a rate equal to 5% above the Federal Reserve discount rate compounded quarterly from the closing date of the merger until the award is actually paid. Progenics stockholders who have properly demanded appraisal rights must file a petition for appraisal with the Court of Chancery within 120 days after the effective date of the merger. Should a material number of Progenics stockholders exercise appraisal rights and should the Court determine that the fair value of such shares of Progenics common stock is materially greater than the merger consideration, Lantheus Holdings will be required to pay significantly more than anticipated in connection with the proposed merger, which could adversely affect the liquidity and financial condition of the combined company. For a more detailed description of the appraisal rights available to Progenics stockholders, see the section entitled “Appraisal or Dissenters’ Rights for Progenics Stockholders” beginning on page 166 of this joint proxy statement/prospectus and the full text of Section 262, attached as Annex E to this joint proxy statement/prospectus.

There can be no assurances that Progenics stockholders will not be required to recognize gain for U.S. federal income tax purposes upon the exchange of Progenics common stock for the merger consideration.

The merger is intended to qualify as a tax-deferred “reorganization” within the meaning of Section 368(a) of the Code, which is referred to in this joint proxy statement/prospectus as the intended tax treatment, and Lantheus Holdings and Progenics have agreed not to report or take any position for U.S. federal, state or local income tax purposes that is inconsistent with the intended tax treatment (except to the extent required by a “determination” as defined in Section 1313(a) of the Code). There can be no assurance, however, that the merger will so qualify. The closing of the merger is not conditioned on the merger qualifying for the intended tax treatment, and it is not contemplated that a tax opinion will be required or delivered as a condition to the closing of the merger. Neither Lantheus Holdings nor Progenics has requested a ruling from the IRS regarding any of the U.S. federal income tax consequences of the merger. Accordingly, there can be no assurance that the IRS will not assert, or that a court would not sustain, a position contrary to the intended tax treatment or any of the conclusions set forth herein. Progenics stockholders should therefore consult their own tax advisors to determine the U.S. federal income tax consequences of the merger to them.

If the IRS or a court determines that the merger does not qualify as a “reorganization” within the meaning of Section 368(a) of the Code, a U.S. holder of Progenics common stock generally would recognize gain or loss upon the exchange of Progenics common stock for the merger consideration pursuant to the merger in an amount equal to the difference, if any, between (i) the sum of the fair market values of the Lantheus Holdings common stock and the CVRs, as determined for U.S. federal income tax purposes, and any cash received in lieu of fractional shares and (ii) such holder’s adjusted tax basis in the Progenics common stock surrendered. You should read the section “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170 of this joint proxy statement/prospectus and consult your own tax advisors regarding the U.S. federal income tax consequences of the transaction to you in your particular circumstances.

 

48


Table of Contents

Risks Related to the CVRs

Progenics stockholders may not receive any payments under the CVRs, which makes it difficult to value the CVRs, and payments under the CVRs are subject to an aggregate payment cap.

Under the merger agreement, in addition to the stock consideration, holders of shares of Progenics common stock have the right to receive one CVR for each share of Progenics common stock held by such person. Each CVR will entitle its holder to receive, subject to the CVR cap, his, her or its pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyL in calendar years 2022 and 2023 in excess of $100 million and $150 million, respectively. The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Lantheus Holdings, Merger Sub, Progenics or any of their respective affiliates. Therefore, Progenics stockholders’ right to receive any future payment with respect to the CVRs will be contingent solely upon the achievement of the foregoing milestones within the specified time periods and other terms and conditions of the CVR agreement, which may or may not occur and may be outside the control of Lantheus Holdings and Progenics. If the milestones are not achieved, no payment will be made under the CVRs and the CVRs will expire valueless. Accordingly, the value, if any, of the CVRs is speculative, and the CVRs may ultimately have no value at all.

In addition, payments under the CVRs are subject to an aggregate payment cap. The sum of (i) the aggregate amount of payments paid or payable pursuant to the CVR agreement (including any interest on such amounts paid or payable to the rights agent or any CVR holder) and (ii) the amount of any other cash or the fair market value of any property (other than Lantheus Holdings common stock or the CVRs) paid or payable to Progenics stockholders as consideration pursuant to the merger agreement will not (A) exceed 19.9% of the aggregate amount of consideration paid or payable to Progenics stockholders in the merger or (B) constitute an amount the payment of which, in the opinion of nationally recognized tax counsel, would more likely than not prevent the merger from satisfying the requirement of Section 368(a)(2)(E)(ii) of the Code. For a more detailed description of the CVRs, see the section entitled “Description of the CVRs” beginning on page 225 of this joint proxy statement/prospectus.

The CVRs are nontransferable.

The CVRs are nontransferable, meaning that they may not be sold, assigned, transferred, pledged, encumbered or in any other manner transferred or disposed of either in whole or in part, other than in certain limited circumstances. The CVRs will not be registered as securities and they will not be listed or traded on any stock exchange in the United States or elsewhere. Therefore, the CVRs are not liquid and Progenics stockholders will not be permitted to sell or transfer them, except in certain limited circumstances. This means that a holder of CVRs may not have any ability to recognize the value of any payment to be made in accordance with the CVR agreement prior to the receipt of such a payment, if any.

Lantheus Holdings’ obligation to obtain FDA approval for PyL and commercialize it in a manner that maximizes net sales is based on “diligent efforts,” which allows for consideration of a variety of factors to determine the efforts Lantheus Holdings is required to take; accordingly, under certain circumstances, Lantheus Holdings may not be required to take certain actions to achieve these goals, which would have an adverse effect on the value, if any, of the CVRs.

From and after the effective time of the merger, Lantheus Holdings has agreed to use “diligent efforts” to obtain FDA Approval for and commercially launch PyL as soon as practicable and thereafter commercialize PyL in a manner that maximizes net sales. However, the CVR agreement definition of “diligent efforts” allows for the consideration of a variety of factors in determining the efforts Lantheus Holdings is required to use to achieve these goals, and it does not require Lantheus Holdings to take all possible actions to achieve them. Under the CVR agreement, the definition of “diligent efforts” requires Lantheus Holdings to use a level of effort, expertise and resources consistent with those efforts, expertise and resources normally used by persons in the medical diagnostics business similar in size and resources to Lantheus Holdings and its affiliates with respect to

 

49


Table of Contents

developing, seeking regulatory approval for and commercializing a product or product candidate that is of similar market potential at a similar stage in its development or product life to PyL.

The U.S. federal income tax treatment of the CVRs is uncertain.

There is no legal authority directly addressing the U.S. federal income tax treatment of the CVRs or the treatment of payments that may be received pursuant to the CVRs. Accordingly, the amount, timing and character of any gain, income or loss with respect to the CVRs are uncertain. Due to the legal and factual uncertainties regarding the tax treatment of the CVRs, U.S. holders are urged to consult their own tax advisors to determine the timing and characterization of income, gain or loss resulting from the receipt of the CVRs and payments pursuant to, sale or other disposition (in certain limited circumstances) of, and the expiration of, the CVRs. For a more detailed summary of the material U.S. federal income tax treatment of the CVRs, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Material U.S. Federal Income Tax Consequences” beginning on page 170.

Risks Related to the Combined Company After Completion of the Merger

The combined company may be unable to successfully integrate the Progenics business into the Lantheus Holdings business and realize the anticipated benefits of the merger.

The success of the merger will depend, in part, on the combined company’s ability to successfully combine the business of Progenics with the business of Lantheus Holdings, which currently operate as independent public companies, and realize the anticipated benefits, including synergies, cost savings, innovation and operational efficiencies and revenue growth from the combination. If the combined company is unable to achieve these objectives within the anticipated time frame, or at all, the anticipated benefits may not be realized fully or at all, or may take longer to realize than expected and the value of the combined company’s common stock may be harmed. The merger involves the integration of Progenics’ business into Lantheus Holdings’ existing business, which is expected to be a complex, costly and time-consuming process. Lantheus Holdings and Progenics have not previously completed a transaction comparable in size or scope to the merger. The integration may result in material challenges, including, without limitation:

 

   

The diversion of management’s attention from ongoing business concerns and performance shortfalls at one or both of the companies as a result of the devotion of management’s attention to the merger;

 

   

Managing a larger combined company;

 

   

Maintaining employee morale and attracting, motivating and retaining management personnel and other key employees;

 

   

Unanticipated risks to the integration plan including in connection with timing, talent and the potential need for additional resources;

 

   

Unanticipated costs, delays and other hardships to integration efforts and key manufacturing, commercial, clinical development and other activities caused by pandemic, epidemic or outbreak of an infectious disease, such as COVID-19 (coronavirus);

 

   

New or previously unidentified manufacturing, regulatory, or research and development issues in Progenics’ business;

 

   

Retaining existing business and operational relationships and attracting new business and operational relationships;

 

   

Integrating corporate and administrative infrastructures in geographically separate organizations and eliminating duplicative expenses;

 

   

Unanticipated issues in integrating information technology, communications and other systems;

 

   

Unanticipated changes in federal or state laws or regulations; and

 

   

Unforeseen expenses or delays associated with the merger.

 

50


Table of Contents

Many of these factors will be outside of the combined company’s control and any one of them could result in delays, increased costs, decreases in the amount of expected revenues and diversion of management’s time and energy, which could materially affect the combined company’s financial position, results of operations and cash flows. Lantheus Holdings will also be responsible for the implementation of the CVRs, and will incur costs in connection therewith, including costs of maintaining a rights agent and the preparation of any applicable net sales statements, among other costs. Lantheus Holdings and Progenics have operated, and until completion of the merger will continue to operate, independently. Lantheus Holdings and Progenics are currently permitted to conduct only limited planning for the integration of the two companies following the merger and have not yet determined the exact nature of how the businesses and operations of the two companies will be combined after the combination. The actual integration of Progenics with Lantheus Holdings’ business may result in additional or unforeseen expenses, and the anticipated benefits of the integration plan may not be realized. These integration matters could have an adverse effect on (i) each of Lantheus Holdings and Progenics during this transition period and (ii) the combined company for an undetermined period after completion of the merger. In addition, any actual cost savings of the merger could be less than anticipated.

Completion of the merger may trigger change in control or other provisions in certain agreements to which Progenics or its subsidiaries are a party, which may have an adverse impact on the combined company’s business and results of operations.

The completion of the merger may trigger change in control and other provisions in certain agreements to which Progenics or its subsidiaries are a party. If Lantheus Holdings and Progenics are unable to negotiate waivers of those provisions, the counterparties may exercise their rights and remedies under the agreements, potentially terminating the agreements or seeking monetary damages. Even if Lantheus Holdings and Progenics are able to negotiate waivers, the counterparties may require a fee for such waivers or seek to renegotiate the agreements on terms less favorable to Progenics or the combined company. Any of the foregoing or similar developments may have an adverse impact on the combined company’s business and results of operations.

The financial analyses and forecasts considered by Lantheus Holdings and Progenics and their respective financial advisors may not be realized, which may adversely affect the market price of Lantheus Holdings common stock following the completion of the merger.

In performing their financial analyses and rendering their opinions related to the merger, each of the respective financial advisors to Lantheus Holdings and Progenics relied on, among other things, internal stand-alone financial analyses and forecasts as separately provided by Lantheus Holdings and Progenics, respectively. See “Opinion of Lantheus Holdings’ Financial Advisor” and “Opinion of Progenics’ Financial Advisor” beginning on pages 140 and 148, respectively. These analyses and forecasts were prepared by, or as directed by, the management of Lantheus Holdings or the management of Progenics, as applicable. None of these analyses or forecasts were prepared with a view towards public disclosure or compliance with the published guidelines of the SEC, the U.S. Generally Accepted Accounting Principles, which is referred to in this joint proxy statement/prospectus as GAAP, or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial forecasts. These projections are inherently based on various estimates and assumptions that are subject to the judgment of those preparing them. These projections are also subject to significant economic, competitive, industry and other uncertainties and contingencies, all of which are difficult or impossible to predict and many of which are beyond the control of Lantheus Holdings and Progenics. There can be no assurance that Lantheus Holdings’ or Progenics’ financial condition or results of operations will be consistent with those set forth in such analyses and forecasts, which could have an adverse impact on the market price of Lantheus Holdings common stock or the financial position of the combined company following the merger.

 

51


Table of Contents

The combined company is expected to incur substantial expenses related to the completion of the merger and the integration of the Progenics business with Lantheus Holdings’ business.

The combined company is expected to incur substantial expenses in connection with the completion of the merger and the integration of the Progenics business with Lantheus Holdings’ business. There are a large number of processes, policies, procedures, operations, technologies and systems that must be integrated, including purchasing, accounting and finance, sales, payroll, pricing, revenue management, marketing and benefits. The substantial majority of these costs will be non-recurring expenses related to the merger, facilities and systems consolidation costs. The combined company may incur additional costs to maintain employee morale and to attract, motivate or retain management personnel or key employees. The combined company will also incur transaction fees and costs related to formulating integration plans for the combined business, and the execution of these plans may lead to additional unanticipated costs. These incremental transaction and acquisition-related costs may exceed the savings the combined company expects to achieve from the elimination of duplicative costs and the realization of other efficiencies related to the integration of the businesses, particularly in the near term and in the event there are material unanticipated costs.

Current Lantheus Holdings stockholders and Progenics stockholders will have a reduced ownership and voting interest after the merger and will exercise less voting power and less influence over the management of the combined company.

Lantheus Holdings expects to issue up to approximately 26,844,956 shares of its common stock to Progenics stockholders in the merger. As a result, Lantheus Holdings and Progenics estimate that, immediately after the completion of the merger, Lantheus Holdings stockholders will own approximately 60% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding) and former Progenics stockholders will own approximately 40% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding). In addition, shares of Lantheus Holdings common stock may be issued from time to time following the effective time of the merger to holders of Progenics stock options on the terms set forth in the merger agreement. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of this joint proxy statement/prospectus for a more detailed explanation.

Consequently, current Lantheus Holdings stockholders in the aggregate will have less voting power and less influence over the management and policies of Lantheus Holdings than they currently have over the management and policies of Lantheus Holdings, and current Progenics stockholders in the aggregate will have significantly less voting power and less influence over the management and policies of Lantheus Holdings than they currently have over the management and policies of Progenics.

Risks Related to Lantheus Holdings and Progenics

A pandemic, epidemic or outbreak of an infectious disease, such as COVID-19, or coronavirus, may materially and adversely affect Lantheus Holdings or Progenics and their respective financial results.

The recent outbreak of COVID-19 originated in Wuhan, China, in December 2019 and has since spread throughout the world including the United States and Europe. The spread of COVID-19 has already affected the global economy and may adversely affect Lantheus Holdings’ or Progenics’ operations and businesses by causing a period of business disruption, including the potential interruption of global supply chains, manufacturing activities, logistics, radiopharmacies and other distribution channels as well as commercial and clinical development activities. Also, this outbreak may impact the operations of hospitals and clinics at which Lantheus Holdings’ or Progenics’ commercial products are used or product candidates are tested, and it may affect the number of medical procedures in which those products are used or product candidates are tested, thereby potentially reducing demand for commercial products and delaying clinical development of product candidates. In addition, there could be a potential effect of COVID-19 on FDA or other health or regulatory

 

52


Table of Contents

authorities, which could result in delays of reviews and approvals, including with respect to Lantheus Holdings’ or Progenics’ product candidates.

Neither Lantheus Holdings nor Progenics can presently predict the scope and severity of any potential business shutdowns or disruptions, but if Lantheus Holdings or Progenics or any of the third parties with whom Lantheus Holdings or Progenics engages were to experience shutdowns or other business disruptions, Lantheus Holdings’ or Progenics’ ability to conduct business in the manner and on the timelines presently planned could be materially and negatively impacted, which could have a material adverse effect on Lantheus Holdings’ or Progenics’ business and their results of operation and financial condition.

Additional Risks Related to Lantheus Holdings and Progenics

Lantheus Holdings and Progenics are, and following completion of the merger Lantheus Holdings will continue to be, subject to the risks described in Part I, Item 1A in Lantheus Holdings’ Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 25, 2020, and Part I, Item 1A in Progenics’ Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 13, 2020, and as updated by their future filings with the SEC, in each case, incorporated by reference into this joint proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

 

53


Table of Contents

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF LANTHEUS HOLDINGS

The following tables present selected historical consolidated financial data of Lantheus Holdings. The selected historical consolidated financial data of Lantheus Holdings for the fiscal years ended December 31, 2019, 2018 and 2017 and as of December 31, 2019 and 2018 are derived from Lantheus Holdings’ audited consolidated financial statements and related notes contained in its Annual Report on Form 10-K for the fiscal year ended December 31, 2019, which is incorporated by reference into this joint proxy statement/prospectus. The selected historical consolidated financial data of Lantheus Holdings for the fiscal years ended December 31, 2016 and 2015, and as of December 31, 2017, 2016 and 2015, have been derived from Lantheus Holdings’ audited consolidated financial statements for such years, which have not been incorporated by reference into this joint proxy statement/prospectus.

The following selected historical consolidated financial data of Lantheus Holdings set forth below is only a summary and is not necessarily indicative of future results. You should read the following information in conjunction with Lantheus Holdings’ audited consolidated financial statements contained in its Annual Report on Form 10-K for the year ended December 31, 2019, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the notes to Lantheus Holdings’ consolidated financial statements for significant events affecting the comparability of results as well as material uncertainties regarding Lantheus Holdings’ future financial condition and results of operations in its entirety. See the section entitled “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

 

     Years Ended December 31,  
     2019     2018     2017     2016     2015  
     (in thousands, except per share data)  

Statements of Operations

          

Revenues

   $  347,337     $ 343,374     $ 331,378     $ 301,853     $ 293,461  

Cost of goods sold

     172,526       168,489       169,243       164,073       157,939  

Sales and marketing

     41,888       43,159       42,315       36,542       34,740  

General and administrative

     61,244       50,167       49,842       38,832       43,894  

Research and development

     20,018       17,071       18,125       12,203       14,358  

Gain on sales of assets

     —         —         —         6,385       —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     51,661       64,488       51,853       56,588       42,530  

Interest expense

     13,617       17,405       18,410       26,618       38,715  

Debt retirement costs

     —         —         —         1,896       —    

Loss on extinguishment of debt

     3,196       —         2,442       —         15,528  

Other expense (income)

     6,221       (2,465     (8,638     (220     65  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     28,627       49,548       39,639       28,294       (11,778
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income tax (benefit) expense(a)

     (3,040     9,030       (83,746     1,532       2,968  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ 31,667     $ 40,518     $ 123,385     $ 26,762     $ (14,746
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per common share:

          

Basic

   $ 0.81     $ 1.06     $ 3.31     $ 0.84     $ (0.60
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

   $ 0.79     $ 1.03     $ 3.17     $ 0.82     $ (0.60
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted-average common shares:

          

Basic

     38,988       38,233       37,276       32,044       24,440  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

     40,113       39,501       38,892       32,656       24,440  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

The 2017 amount reflects the release of Lantheus Holdings’ valuation allowance of $141.1 million against its deferred tax assets offset by a provision of $45.1 million for remeasuring the Company’s deferred tax assets for the change in tax rates enacted under the Tax Cuts and Jobs Act of 2017.

 

     December 31,  
     2019      2018     2017     2016     2015  
     (in thousands)  

Balance Sheet Data

           

Cash and cash equivalents

   $ 92,919      $ 113,401     $ 76,290     $ 51,178     $ 28,596  

Total assets

     405,919        439,831       383,858       255,898       242,379  

Long-term debt, net

     183,927        263,709       265,393       274,460       349,858  

Total liabilities

     291,318        368,829       360,567       362,414       427,668  

Total stockholders’ equity (deficit)

     114,601        71,002       23,291       (106,516     (185,289

 

54


Table of Contents

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF PROGENICS

The following tables present selected historical consolidated financial data of Progenics. The selected historical consolidated financial data of Progenics for the fiscal years ended December 31, 2019, 2018 and 2017 and as of December 31, 2019 and 2018 are derived from Progenics’ audited consolidated financial statements and related notes contained in its Annual Report on Form 10-K for the year ended December 31, 2019, which is incorporated by reference into this joint proxy statement/prospectus. The selected historical consolidated financial data of Progenics for the fiscal years ended December 31, 2016 and 2015 and as of December 31, 2017, 2016 and 2015 are derived from Progenics’ audited consolidated financial statements for such years, which have not been incorporated by reference into this joint proxy statement/prospectus.

The following selected historical consolidated financial data of Progenics set forth below is only a summary and is not necessarily indicative of future results. You should read the following information in conjunction with Progenics’ audited consolidated financial statements contained in its Annual Report on Form 10-K for the year ended December 31, 2019, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the notes to Progenics’ consolidated financial statements for significant events affecting the comparability of results as well as material uncertainties regarding Progenics’ future financial condition and results of operations. See the section entitled “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

 

    Years Ended December 31,  
    2019     2018     2017     2016     2015  
    (in thousands, except per share data)  

Consolidated Statements of Operations Data(a):

         

Revenue:

         

Product sales

  $ 1,559     $ —       $ —       $ —       $ —    

Royalty income

    16,970       14,908       10,965       10,295       6,608  

License and other revenue

    16,457       714       733       59,134       2,068  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

    34,986       15,622       11,698       69,429       8,676  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

         

Cost of goods sold

    3,168       —         —         —         —    

Research and development

    49,223       35,147       42,589       37,569       28,196  

Selling, general and administrative

    47,838       29,431       24,909       23,356       18,184  

Intangible impairment charges

    —         23,200       —         —         —    

Change in contingent consideration liability

    916       (5,800     2,600       (4,600     1,600  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

    101,145       81,978       70,098       56,325       47,980  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating (loss) income

    (66,159     (66,356     (58,400     13,104       (39,304
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Other (expense) income:

         

Interest (expense) income and other income, net

    (2,376     (2,933     (4,285     (527     52  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total other (expense) income

    (2,376     (2,933     (4,285     (527     52  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) income before income tax (expense) benefit

    (68,535     (69,289     (62,685     12,577       (39,252
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income tax (expense) benefit

    (17     1,632       11,672       (1,844     133  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss) income

    (68,552     (67,657     (51,013     10,733       (39,119

Net loss attributable to noncontrolling interests

    —         —         —         (73     (7
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net (loss) income attributable to Progenics

  $ (68,552   $ (67,657   $ (51,013   $ 10,806     $ (39,112
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Per share amount on net (loss) income attributable to Progenics:

         

Basic

  $ (0.80   $ (0.87   $ (0.73   $ 0.15     $ (0.56
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

  $ (0.80   $ (0.87   $ (0.73   $ 0.15     $ (0.56
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

55


Table of Contents
    December 31,  
    2019     2018     2017     2016     2015  
    (in thousands)  

Consolidated Balance Sheets Data(a):

         

Cash and cash equivalents

  $ 42,049     $ 137,686     $ 90,642     $ 138,909     $ 74,103  

Working capital

    41,664       120,683       81,511       131,744       73,556  

Total assets

    119,470       169,497       145,957       198,986       131,251  

Other liabilities—long term

    50,849       44,976       67,145       77,867       30,861  

Total stockholders’ equity

    46,553       101,075       63,453       104,762       90,661  

 

(a)

The selected consolidated statement of operations data for the fiscal year ended December 31, 2019 and the selected consolidated balance sheet data as of December 31, 2019 reflect the modified retrospective adoption of ASU 2016-02, “Leases (Topic 842).”

 

56


Table of Contents

COMPARATIVE HISTORICAL AND UNAUDITED

PRO FORMA COMBINED PER SHARE DATA

The following table sets forth selected historical and unaudited pro forma combined per share information for Lantheus Holdings and Progenics.

Historical Per Share of Common Stock Information of Lantheus Holdings and Progenics. The historical per share of common stock information of each of Lantheus Holdings and Progenics below is derived from the audited consolidated financial statements of each of Lantheus Holdings and Progenics as of and for the year ended December 31, 2019.

Unaudited Pro Forma Combined Per Lantheus Holdings Share of Common Stock Data. The Lantheus Holdings unaudited pro forma combined per share of common stock data set forth below gives effect to the merger under the acquisition method of accounting as if the merger had been effective on January 1, 2019, the first day of Lantheus Holdings’ fiscal year ended December 31, 2019. The unaudited pro forma combined book value per share of Lantheus Holdings common stock data set forth below gives effect to the merger under the acquisition method of accounting as if the merger had been effective December 31, 2019, assuming that each outstanding share of Progenics common stock had been converted into shares of Lantheus Holdings common stock based on the exchange ratio of 0.31.

The acquisition method of accounting is based on ASC 805, and uses the fair value concepts defined in Accounting Standards Codification 820, Fair Value Measurements (“ASC 820”). Acquisition accounting requires, among other things, that certain assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The pro forma adjustments reflect Lantheus Holdings’ provisional estimates of fair value for certain assets and liabilities of Progenics. Differences between these preliminary estimates and the final fair values determined as part of acquisition accounting upon closing of the transaction will occur, and these differences could have a material impact on the unaudited pro forma combined per share information set forth in the following table.

The unaudited pro forma combined per share of Lantheus Holdings common stock data is presented for illustrative purposes only and does not purport to represent the actual financial position or results of operations that Lantheus Holdings would have achieved had the companies been combined during these periods or to project the future financial position or results of operations that Lantheus Holdings may achieve after completion of the merger.

Unaudited Pro Forma Combined Per Progenics Equivalent Share Data. The Progenics unaudited pro forma combined per Progenics equivalent share data set forth below shows the effect of the merger from the perspective of an owner of shares of Progenics common stock. The information was calculated by multiplying the unaudited pro forma combined per share of Lantheus Holdings common stock amounts by the exchange ratio of 0.31.

 

57


Table of Contents

General Information. You should read the below information in conjunction with the selected historical consolidated financial data included elsewhere in this joint proxy statement/prospectus and the historical consolidated financial statements of Lantheus Holdings and Progenics and related notes that have been filed with the SEC, certain of which are incorporated by reference into this joint proxy statement/prospectus. See “Selected Historical Consolidated Financial Data of Lantheus Holdings,” “Selected Historical Consolidated Financial Data of Progenics” and “Where You Can Find More Information” beginning on pages 54, 55 and 260, respectively, of this joint proxy statement/prospectus. The unaudited pro forma combined per share of Lantheus Holdings common stock data and the unaudited pro forma combined per Progenics equivalent share data is derived from, and should be read in conjunction with, the Lantheus Holdings and Progenics unaudited pro forma condensed combined financial statements and related notes included in this joint proxy statement/prospectus. See “Certain

Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 59 of this joint proxy statement/prospectus.

 

     As of and For the Year
Ended December 31,
2019
 

Lantheus Holdings Historical per Common Share Data:

  

Net income—basic

   $ 0.81  

Net income—diluted

     0.79  

Book value(1)

     2.92  

Progenics Historical per Common Share Data:

  

Net loss—basic and diluted

   $ (0.80

Book value(1)

     0.54  

Unaudited Pro Forma Combined per Lantheus Holdings Common Share Data:

  

Net loss—basic and diluted

   $ (0.29

Book value(1)

     7.86  

Unaudited Pro Forma Combined per Progenics Equivalent Share Data:

  

Net loss—basic and diluted(2)

   $ (0.09

Book value(1)

     2.44  

 

(1)

Amounts calculated by dividing the applicable total stockholders’ equity by the applicable shares of common stock outstanding.

(2)

Amounts calculated by multiplying unaudited pro forma combined per share amounts by the exchange ratio of 0.31. This information shows how each share of Progenics common stock would have participated in the combined company’s net loss and book value if the pro forma impacts of the transaction had occurred on the relevant dates.

 

58


Table of Contents

CERTAIN UNAUDITED PRO FORMA CONDENSED

COMBINED FINANCIAL STATEMENTS

The following unaudited pro forma condensed combined financial statements are presented to illustrate the estimated effects of the merger.

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2019 combine the historical consolidated statements of operations of Lantheus Holdings and Progenics, giving effect to the merger as if it occurred on January 1, 2019. The unaudited pro forma condensed combined balance sheet as of December 31, 2019 combines the historical consolidated balance sheets of Lantheus Holdings and Progenics, giving effect to the merger as if the merger had occurred on December 31, 2019. The historical consolidated financial statements have been adjusted in the unaudited pro forma condensed combined financial statements to give effect to pro forma adjustments that are (1) directly attributable to the merger, (2) factually supportable and (3) with respect to the unaudited pro forma condensed combined statement of operations, expected to have a continuing impact on the combined results.

The unaudited pro forma condensed combined financial statements should be read in conjunction with the accompanying notes to the unaudited pro forma condensed combined financial statements. In addition, the unaudited pro forma condensed combined financial statements have been derived from and should be read in conjunction with the following historical consolidated financial statements and notes incorporated by reference into this joint proxy statement/prospectus: (a) the audited consolidated financial statements of Lantheus Holdings contained in its Annual Report on Form 10-K for the year ended December 31, 2019; and (b) the audited consolidated financial statements of Progenics contained in its Annual Report on Form 10-K for the year ended December 31, 2019. Refer to the section of this joint proxy statement/prospectus titled “Where You Can Find More Information” for instructions on how to obtain these documents.

The unaudited pro forma condensed combined financial statements have been prepared by management in accordance with Article 11, Pro Forma Financial Information, under Regulation S-X of the Exchange Act, and are for illustrative and informational purposes only. The unaudited pro forma condensed combined financial statements are not necessarily indicative of what the combined company’s financial position or results of operations actually would have been had the merger been completed as of the dates indicated. In addition, the unaudited pro forma condensed combined financial statements do not purport to project the future financial position or operating results of the combined company. There were no material transactions between Lantheus Holdings and Progenics during the periods presented in the unaudited pro forma condensed combined financial statements that would need to be eliminated.

The unaudited pro forma condensed combined financial statements have been prepared using the acquisition method of accounting under ASC 805, with Lantheus Holdings being the accounting acquirer in the proposed merger with Progenics. As of the date of this joint proxy statement/prospectus, Lantheus Holdings has not completed the detailed valuation studies necessary to arrive at the final estimates of the fair market value of certain Progenics assets to be acquired and liabilities to be assumed and the related allocations of purchase price, nor has it identified all adjustments necessary to conform Progenics to Lantheus Holdings’ accounting policies, except for the ones described in the accompanying notes. The acquisition method of accounting is dependent upon certain valuations that are provisional in nature and subject to change. Accordingly, the pro forma adjustments in the unaudited pro forma condensed combined financial statements are preliminary, based upon available information and made solely for the purpose of preparing these unaudited pro forma condensed combined financial statements. Actual results will differ from the unaudited pro forma condensed combined financial statements once the final acquisition accounting by Lantheus Holdings has been completed, Lantheus Holdings has determined the final purchase price for Progenics, the valuation studies necessary to finalize the required purchase price allocations have been completed and if Lantheus Holdings identifies any additional conforming accounting policy changes outside of the ones provided in the accompanying notes. There can be no assurance that such finalization will not result in material changes.

 

59


Table of Contents

The unaudited pro forma condensed combined financial statements do not reflect any expected cost savings, operating synergies or revenue enhancements that the combined company may achieve as a result of the merger, any termination, restructuring or other costs to integrate the operations of Lantheus Holdings and Progenics or the costs necessary to achieve any such cost savings, operating synergies or revenue enhancements.

 

60


Table of Contents

Lantheus Holdings, Inc.

Unaudited Pro Forma Condensed Combined Balance Sheet

As of December 31, 2019

(in thousands)

 

     Historical     Pro forma
adjustments
   

(Note 6)

   Pro forma
combined
company
 
     Lantheus
Holdings
    Progenics after
reclassification
(Note 4)
 

Assets

           

Current assets

           

Cash and cash equivalents

   $ 92,919     $ 42,049     $ (1,500   (g)    $ 133,468  

Accounts receivable, net

     43,529       15,976       —            59,505  

Inventory

     29,180       —         —            29,180  

Other current assets

     7,283       5,707       (1,526   (j)      11,464  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total current assets

     172,911       63,732       (3,026        233,617  

Property, plant and equipment, net

     116,497       11,688       —            128,185  

Intangibles, net

     7,336       6,823       362,647     (c)      376,806  

Goodwill

     15,714       17,847       14,385     (i)      47,946  

Deferred tax assets, net

     71,834       —         1,830     (e)      73,664  

Other long-term assets

     21,627       19,380       7,398     (b)      48,405  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total assets

   $ 405,919     $ 119,470     $ 383,234        $ 908,623  
  

 

 

   

 

 

   

 

 

      

 

 

 

Liabilities and stockholders’ equity

           

Current liabilities

           

Current portion of long-term debt and other borrowings

   $ 10,143     $ 7,117     $ 232     (d)    $ 17,492  

Accounts payable

     18,608       1,249       —            19,857  

Accrued expenses and other liabilities

     37,360       13,702       16,668     (b,f,j)      67,730  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total current liabilities

     66,111       22,068       16,900          105,079  

Asset retirement obligations

     12,883       —         —            12,883  

Long-term debt, net and other borrowings

     183,927       31,910       853     (d)      216,690  

Other long-term liabilities

     28,397       18,939       7,271     (a,b,e)      54,607  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total liabilities

     291,318       72,917       25,024          389,259  
  

 

 

   

 

 

   

 

 

      

 

 

 

Stockholders’ equity

           

Preferred stock

     —         —         —            —    

Common stock

     393       113       155     (a,h)      661  

Additional paid-in capital

     251,641       724,348       (302,787   (a,h,j)      673,202  

Accumulated deficit

     (136,473     (677,760     660,694     (f,g,h)      (153,539

Accumulated other comprehensive (loss) income

     (960     (148     148     (h)      (960
  

 

 

   

 

 

   

 

 

      

 

 

 

Total stockholders’ equity

     114,601       46,553       358, 210          519,364  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total liabilities and stockholders’ equity

   $ 405,919     $ 119,470     $ 383,234        $ 908,623  
  

 

 

   

 

 

   

 

 

      

 

 

 

The accompanying notes are an integral part of these unaudited pro forma condensed combined financial statements.

 

61


Table of Contents

Lantheus Holdings, Inc.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the Year Ended December 31, 2019

(in thousands, except per share data)

 

     Historical                   
     Lantheus
Holdings
    Progenics after
reclassification

(Note 4)
    Pro forma
adjustments
   

(Note 7)

   Pro forma
combined
company
 

Revenues

   $ 347,337     $ 34,986     $ —          $ 382,323  

Cost of goods sold

     172,526       3,168       14,541     (b)      190,235  
  

 

 

   

 

 

   

 

 

      

 

 

 

Gross profit

     174,811       31,818       (14,541        192,088  

Operating expenses:

           

Sales and marketing

     41,888       11,514       (400   (d)      53,002  

General and administrative

     61,244       37,240       (13,146   (a,b,c,d)      85,338  

Research and development

     20,018       49,223       (1,124   (d)      68,117  
  

 

 

   

 

 

   

 

 

      

 

 

 

Total operating expenses

     123,150       97,977       (14,670        206,457  
  

 

 

   

 

 

   

 

 

      

 

 

 

Operating income (loss)

     51,661       (66,159     129          (14,369

Interest expense

     13,617       4,402       —            18,019  

Loss on extinguishment of debt

     3,196       —         —            3,196  

Other expense (income)

     6,221       (2,026     —            4,195  
  

 

 

   

 

 

   

 

 

      

 

 

 

Income (loss) before income taxes

     28,627       (68,535     129          (39,779

Income tax (benefit) expense

     (3,040     17       (17,954   (e)      (20,977
  

 

 

   

 

 

   

 

 

      

 

 

 

Net income (loss)

   $ 31,667     $ (68,552   $ 18,083        $ (18,802
  

 

 

   

 

 

   

 

 

      

 

 

 

Net income (loss) per common share:

           

Basic

   $ 0.81            $ (0.29
  

 

 

          

 

 

 

Diluted

   $ 0.79            $ (0.29
  

 

 

          

 

 

 

Weighted-average common shares outstanding:

           

Basic

     38,988         26,834     (f)      65,822  
  

 

 

     

 

 

      

 

 

 

Diluted

     40,113         25,709     (f)      65,822  
  

 

 

     

 

 

      

 

 

 

The accompanying notes are an integral part of these unaudited pro forma condensed combined financial statements.

 

62


Table of Contents

NOTES TO THE UNAUDITED PRO FORMA CONDENSED

COMBINED FINANCIAL STATEMENTS

 

1.

Description of the merger

On October 1, 2019, Lantheus Holdings, Merger Sub and Progenics entered into an Agreement and Plan of Merger. On February 20, 2020, the parties entered into an Amended and Restated Agreement and Plan of Merger, which is referred to in this joint proxy statement/prospectus as the merger agreement, that amended and restated the original merger agreement in its entirety. Subject to the terms and conditions of the merger agreement and in accordance with applicable law, Merger Sub will be merged with and into Progenics, with Progenics continuing as the surviving corporation and a wholly-owned subsidiary of Lantheus Holdings. Each share of Progenics common stock issued and outstanding will be converted into 0.31 shares of Lantheus Holdings common stock and one CVR per share of Progenics common stock representing the right to receive, subject to the CVR cap as discussed in Note 5, such stockholder’s pro rata share of aggregate cash payments equal to 40% of U.S. net sales generated by PyL in calendar years 2022 and 2023 in excess of $100.0 million and $150.0 million, respectively, as set forth in the CVR agreement. In addition, Lantheus Holdings will issue replacement awards, subject to the exchange ratio of 0.31, for each in-the-money vested and unvested Progenics stock option outstanding and unexercised immediately before the closing of the merger. Holders of in-the-money Progenics stock options as of the closing date are also entitled to receive one CVR for each share of Progenics common stock underlying such in-the-money options. Holders of out-of-the-money Progenics stock options will receive replacement awards converted on an exchange ratio adjusted based on actual trading prices of common stock of Progenics and Lantheus Holdings prior to the effective time of the merger. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of the accompanying joint proxy statement/prospectus for a more detailed explanation.

Based on the closing price of Lantheus Holdings common stock of $15.55 on February 28, 2020, the common stock component of the purchase price is $417.3 million. The total estimated purchase price inclusive of the fair value of the portion of the replacement awards attributable to precombination services and the CVRs is $426.5 million.

The transaction is subject to approval by Lantheus Holdings and Progenics stockholders and the satisfaction of customary closing conditions and regulatory approvals. Lantheus Holdings and Progenics expect to complete the transaction early in the second quarter of 2020.

 

2.

Basis of presentation

The unaudited pro forma condensed combined financial statements were prepared using the acquisition method of accounting and were based on the historical financial statements of Lantheus Holdings and Progenics. Certain reclassifications have been made to the historical financial statements of Progenics to conform to Lantheus Holdings’ presentation, which are discussed in more detail in “Note 4. Historical Progenics.”

The acquisition method of accounting is based on ASC 805 and utilizes the fair value concepts in ASC 820.

ASC 805 requires, among other things, that certain assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. In addition, ASC 805 establishes that the consideration transferred be measured at the closing date of the merger at fair value based upon the then-current market price of Lantheus Holdings common stock; this particular requirement will likely result in a per share equity component that is different from the amount assumed in these unaudited pro forma condensed combined financial statements, and that difference may be material.

ASC 820 defines the term “fair value” and sets forth the valuation requirements for any asset or liability measured at fair value. Fair value is defined in ASC 820 as “the price that would be received to sell an asset or

 

63


Table of Contents

paid to transfer a liability in an orderly transaction between market participants at the measurement date.” This is an exit price concept for the valuation of the asset or liability. In addition, market participants are assumed to be buyers and sellers in the principal (or the most advantageous) market for the asset or liability. Fair value measurements for an asset assume the highest and best use by these market participants. As a result of these standards, Lantheus Holdings may be required to record assets which are not intended to be used or sold and/or to value assets at fair value measures that do not reflect Lantheus Holdings’ intended use of those assets. Many of these fair value measurements can be highly subjective and it is also possible that other professionals, applying reasonable judgment to the same facts and circumstances, could develop and support a range of alternative estimated amounts.

Under ASC 805, acquisition-related transaction costs are not included as a component of consideration transferred but are accounted for as expenses in the period in which the costs are incurred. Total transaction costs in connection with the merger are estimated to be approximately $29.2 million, which does not include the impacts of any revenue, cost or other operating synergies that may result from the merger or any related restructuring costs that may be contemplated.

The anticipated merger related transaction costs expected to be incurred after December 31, 2019 are reflected in the unaudited pro forma condensed combined balance sheet as an increase to accrued expenses and other liabilities and an increase to accumulated deficit. All transaction expenses that were incurred by Lantheus Holdings and Progenics have been eliminated from the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2019 as these costs do not have a continuing impact.

 

3.

Accounting policies

The unaudited pro forma condensed combined financial statements do not assume any differences in accounting policies, except as described below, as Lantheus Holdings is not aware of any differences that would have a material impact on the unaudited pro forma condensed combined financial statements. Further review of Progenics’ detailed accounting policies following the completion of the merger may result in the identification of additional differences between the accounting policies of the two companies that, when conformed, could have a material impact on the financial statements of the combined company. Certain reclassifications have been made to the historical financial statements of Progenics to conform to Lantheus Holdings’ presentation, which are discussed in more detail in “Note 4. Historical Progenics.”

 

4.

Historical Progenics

Certain reclassifications have been made to the historical financial statements of Progenics to conform to Lantheus Holdings’ presentation as follows:

Unaudited pro forma condensed combined balance sheet as of December 31, 2019

 

Item

   Amount
(in thousands)
    Presentation in Progenics
Financial Statements
   Presentation in Unaudited Pro
Forma Condensed Combined
Balance Sheet

Operating right-of-use lease assets

   $ 13,493     Operating right-of-use lease assets    Other long-term assets

Current operating lease liabilities

     599     Operating lease liabilities    Accrued expenses and
other current liabilities

Noncurrent operating lease liabilities

     15,005     Noncurrent operating lease
liabilities
   Other long-term liabilities

Contingent consideration liability

     3,900     Contingent consideration liability    Other long-term liabilities

Deferred tax liability

     34     Deferred tax liability    Other long-term liabilities

Treasury stock

     (2,741   Treasury stock    Additional paid-in capital

 

64


Table of Contents

Unaudited pro forma condensed combined statement of operations for the year December 31, 2019

 

Item

  Amount
(in thousands)
   

Presentation in Progenics
Financial Statements

 

Presentation in Unaudited Pro
Forma Condensed Combined
Statement of Operations

Sales and marketing

  $ 11,514     Selling, general, and administrative   Sales and marketing expense

General and administrative

    36,324     Selling, general, and administrative   General and administrative expense

Change in contingent consideration liability

    916     Change in contingent consideration liability   General and administrative expense

Interest expense

    (4,402   Interest (expense) income and other income, net   Interest expense

Other income

    2,026     Interest (expense) income and other income, net   Other expense (income)

 

5.

Estimate of consideration expected to be transferred in the merger and preliminary purchase price allocation

The following is a preliminary estimate of the consideration expected to be transferred to affect the merger (in thousands, except share and per share data):

 

Progenics shares outstanding at December 31, 2019

     86,560,817  

Exchange ratio

     0.31  
  

 

 

 

Equivalent Lantheus Holdings shares to be issued

     26,833,853  

Closing price of Lantheus Holdings common stock on February 28, 2020

   $ 15.55  
  

 

 

 

Estimated fair value of stock consideration

   $ 417,266  
  

 

 

 

Estimated fair value of replacement options issued related to precombination services

     6,698  

Estimated fair value of CVRs

     2,500  
  

 

 

 

Estimated fair value of total consideration to be transferred

   $ 426,464  
  

 

 

 

The preliminary estimate of consideration expected to be transferred reflected in these unaudited pro forma condensed combined financial statements does not purport to represent what the actual consideration transferred will be when the merger is completed. For purposes of these unaudited pro forma condensed combined financial statements, the market price per share of Lantheus Holdings common stock on February 28, 2020 and the Progenics shares of common stock and share-based compensation awards outstanding as of December 31, 2019 were used to calculate the estimate of consideration expected to be transferred. Ultimately, the fair value of equity securities issued as the consideration transferred will be measured using the market price per share of Lantheus Holdings common stock on the closing date. Assuming a 10% change in the closing price per share of the Lantheus Holdings common stock, the estimated fair value of stock consideration transferred would increase or decrease by approximately $41.7 million, which would be reflected in these unaudited pro forma condensed combined financial statements as an adjustment to the amounts assigned to the identifiable assets acquired, including goodwill, and the liabilities assumed.

If the closing price per share of Lantheus Holdings common stock on March 18, 2020 of $9.11 had been used to calculate the estimate of consideration expected to be transferred, the estimated fair value of the stock consideration transferred would have decreased by approximately $172.8 million, which would be reflected in these unaudited pro forma condensed combined financial statements as an adjustment to the amounts assigned to the identifiable assets acquired, including goodwill, and the liabilities assumed.

The preliminary estimate of the fair value of share-based compensation awards relates to certain options to purchase shares of Progenics common stock that will be converted into Lantheus Holdings stock options to purchase shares of Lantheus Holdings common stock. Given that Lantheus Holdings is obligated to grant replacement awards in conjunction with the merger, the fair value of the replacement awards attributable to

 

65


Table of Contents

precombination services was included in the total consideration transferred. Additionally, as Lantheus Holdings is also obligated to grant CVRs to each owner of Progenics common stock and of in-the-money stock options as of the closing date as a form of contingent consideration, the fair value of the CVRs has been included in consideration transferred. The aggregate amount of the payments made pursuant to the terms of the CVR agreement cannot exceed 19.9% of the aggregate amount of consideration transferred to the Progenics’ common stockholders.

The number of shares of Lantheus Holdings common stock issued to holders of Progenics common stock, number of replacement share-based compensation awards and number of CVRs granted are dependent on the number of Progenics shares of common stock and options to purchase shares of Progenics common stock outstanding on the closing date of the merger and, for the CVRs, the actual trading price of the Progenics common stock during the period immediately preceding the closing date of the merger.

The following is a preliminary estimate of the assets to be acquired and liabilities to be assumed by Lantheus Holdings in the merger, reconciled to the estimate of consideration expected to be transferred (in thousands):

 

Cash and cash equivalents

    $ 42,049  

Accounts receivable

      15,976  

Other current assets

      5,707  

Property, plant and equipment

    (a     11,688  

Intangible assets

    (b     369,470  

Other long-term assets

      26,778  

Deferred tax assets, net

    (c     1,830  

Accounts payable

      (1,249

Accrued expenses and other liabilities

      (14,195

Other long-term liabilities

      (23,709

Long-term debt and other borrowings

      (40,113

Goodwill

    (d     32,232  
   

 

 

 

Estimate of consideration expected to be transferred

    $ 426,464  
   

 

 

 

 

(a)

A preliminary fair value estimate of $11.7 million, equivalent to the current net book value, has been assigned to property, plant and equipment to be acquired, primarily consisting of machinery and equipment, leasehold improvements, computer software and equipment and construction in progress.

 

(b)

A preliminary fair value estimate of $369.5 million has been assigned to identifiable intangible assets acquired, consisting primarily of currently marketed product rights, licenses, developed technology and in-process research and development (“IPR&D”).

The fair value of identifiable intangible assets is determined using either an income-based method referred to as the multi-period excess earnings method (“MPEEM”) or a probability weighted expected return method (“PWERM”). The more significant assumptions inherent in the application of the MPEEM include the amount and timing of projected future cash flows (including revenue, cost of sales, research and development costs, sales and marketing expenses, other general and administrative costs and income taxes), the level of and return for other assets that contribute to the subject assets’ ability to generate cash flows, and the discount rate selected to measure the risks inherent in the future cash flows. The more significant assumptions inherent in the application of the PWERM include the amount and timing of future cash flows (including milestone and/or royalty payments), the timing and probability of such payments occurring and the discount rate selected to measure the remaining risks inherent in the future cash flows. Of the total $6.8 million historical book value of Progenics’ intangible assets as of December 31, 2019, $1.1 million related to manufacturing know-how, the book value of which was determined to approximate fair value for purposes of these unaudited condensed combined pro forma financial statements.

 

66


Table of Contents

The estimated fair value of the identifiable intangible assets and a preliminary estimate of their estimated useful lives are as follows (in thousands):

 

     Estimated
fair value
     Estimated
useful life
(in years)
 

Currently marketed product

   $ 154,600        17  

Licenses

     71,900        14  

Developed technology

     2,300        17  

Manufacturing know-how

     1,070        6.5  

IPR&D*

     139,600        N/A  
  

 

 

    

Total

   $ 369,470     
  

 

 

    

 

  *

As discussed above, acquired IPR&D assets are initially recognized at fair value and are classified as indefinite-lived assets until the successful completion or abandonment of the associated research and development efforts. Accordingly, during the research and development period after the closing date of the merger, these assets will not be amortized into earnings; instead these assets will be subject to periodic impairment testing. Upon successful completion of the development process for an acquired IPR&D project, determination as to the useful life of the asset will be made; at that point in time, the asset would then be considered a finite-lived intangible asset and Lantheus Holdings would begin to amortize the asset into earnings over its estimated useful life.

 

(c)

Represents the preliminary estimate of deferred taxes primarily resulting from net operating losses, partially offset by the fair value adjustments for intangible assets. This estimate was determined based on the fair value adjustments at an estimated blended statutory tax rate of 25.68%. The estimate of deferred taxes is preliminary and is subject to change based upon Lantheus Holdings’ final determination of the fair values of the assets acquired and liabilities assumed as well as the applicable statutory tax rates and realizability of the deferred taxes. As of each reporting date, Lantheus Holdings considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. Based on all available evidence, including the impact of intangible assets acquired as part of this transaction, our history of earnings, and forecasts of future income, Lantheus Holdings has determined that there is sufficient positive evidence to conclude that it is more likely than not that as of December 31, 2019, additional net deferred tax assets of $1.8 million are realizable. It therefore removed the valuation allowance on Progenics’ historical U.S. deferred tax assets. Under Section 382 of the Code, a corporation that undergoes an “ownership change” may be subject to certain limitations on its ability to utilize its net operating losses (“NOLs”) and credits to offset and reduce future taxable income and tax. As such, Lantheus Holdings’ and Progenics’ ability to use its NOLs may be limited due to “ownership changes,” including any such “ownership change” that is caused by the merger. Actual results will differ from the amounts reflected in the unaudited pro forma condensed combined financial statements once the final acquisition accounting by Lantheus Holdings has been completed.

 

(d)

The preliminary estimate of goodwill arising from the merger is $32.2 million. Goodwill is calculated as the difference between the fair value of the consideration expected to be transferred and the fair values assigned to the assets acquired and liabilities assumed. The goodwill is attributable to the workforce of the business and the value of synergies expected to arise after the merger. The pro forma adjustment to goodwill is as follows (in thousands):

 

     As of December 31,
2019
 

Estimated goodwill related to the merger

   $ 32,232  

Less: Historical Progenics’ goodwill

     17,847  
  

 

 

 

Total pro forma adjustment

   $ 14,385  
  

 

 

 

 

67


Table of Contents

The acquisition method of accounting is dependent upon certain valuations that are provisional and subject to change. Accordingly, the pro forma adjustments are preliminary and made solely for the purpose of providing these unaudited pro forma condensed combined financial statements. Differences between these preliminary estimates and the final acquisition accounting for the merger will occur and these differences could have a material impact on the accompanying unaudited pro forma condensed combined financial statements and the future results of operations and financial position of the combined company.

 

6.

Pro forma adjustments to the unaudited pro forma condensed combined balance sheet in connection with the merger

The unaudited pro forma condensed combined balance sheet reflects the proposed combination of Lantheus Holdings and Progenics using the acquisition method of accounting as of December 31, 2019. This note should be read in conjunction with “Note 1. Description of the merger,” “Note 2. Basis of presentation” and “Note 5. Estimate of consideration expected to be transferred in the merger and preliminary purchase price allocation.”

Adjustments included in the column under the heading “Pro forma adjustments” represent the following:

 

(a)

Estimated fair value of consideration transferred

Reflects the adjustment to record merger consideration of $426.5 million (including $417.3 million related to the common stock component of the purchase price, $2.5 million related to the fair value of the CVRs as contingent consideration, and $6.7 million related to the fair value of the portion of the replacement awards attributable to precombination services). Of the total consideration transferred, $0.3 million is recorded as an increase to common stock and $423.7 million is recorded as an increase to additional paid-in capital and $2.5 million is recorded as an increase to other long-term liabilities.

 

(b)

Leases

Reflects the adjustment for leases in which Progenics is the lessee of $5.3 million to the acquired lease liability, of which there is a current portion of $0.5 million and a noncurrent portion of $4.8 million, to record those leases at the present value of the remaining lease payments as if the leases were new leases of Lantheus Holdings at the acquisition date. A pro forma adjustment of $7.4 million has also been made to the right-of-use asset to measure it at an amount equal to the lease liability on the acquisition date.

 

(c)

Intangible assets

Reflects the adjustment to record Progenics’ intangible assets at their estimated fair value of $369.5 million and to eliminate the book value of Progenics’ historical intangible assets of $6.8 million. IPR&D of $139.6 million will be capitalized and accounted for as indefinite-lived intangible assets and will be subject to impairment testing until completion or abandonment of the projects. Upon successful completion of each project and launch of the product, Lantheus Holdings will make a separate determination of the useful life of the IPR&D intangibles and Lantheus Holdings will begin to amortize the asset into earnings over its estimated useful life. Refer to Note 5(b) above for additional information.

 

(d)

Long-term debt

Reflects the adjustment to record Progenics’ long-term debt assumed by Lantheus Holdings at its estimated fair value of $40.1 million, including the elimination of historical deferred financing costs of $0.5 million to goodwill, of which $0.2 million was allocated to the current portion of long term debt, and recording a $0.6 million change in control fee payable to the lender, pursuant to existing contractual terms, to long-term debt, net and other borrowings. After giving effect to the elimination of historical deferred financing fees and the lenders fee noted above, as well as the contractual terms of the debt, the historical book value of the debt was determined to approximate fair value for purposes of these unaudited condensed combined pro forma financial statements.

 

68


Table of Contents
(e)

Deferred taxes

Reflects the preliminary estimate of deferred income taxes primarily resulting from net operating losses, partially offset by the fair value adjustments for identifiable intangible assets. This estimate was determined based on the fair value adjustments at an estimated 25.68% U.S. federal and state statutory tax rate. Refer to Note 5(c) above for additional information.

 

(f)

Transaction costs

Reflects the adjustment for estimated transaction costs related to the merger of $15.6 million that were not previously recorded in the historical combined financial statements. These costs are reflected as an increase in accrued expenses and other liabilities and an increase to accumulated deficit in the unaudited pro forma condensed combined balance sheet.

 

(g)

Progenics retention payments

Reflects the adjustment to record post-combination compensation expense of $1.5 million related to retention payments payable on the closing date of the merger to certain existing Progenics employees. The adjustment is reflected as a reduction to cash and cash and equivalents and increase to accumulated deficit in the unaudited pro forma condensed combined balance sheet. The total amount of retention payments owed to certain existing Progenics employees is $3.0 million. The unaudited pro forma condensed combined balance sheet does not include an adjustment for the remaining $1.5 million of retention payments as those payments are contingent upon the employees’ continued employment through a specified period of six months after the closing date of the merger and the related expense will begin to accrue upon the closing of the merger. Additionally, as there is no continuing impact, these costs are not included in the unaudited pro forma condensed combined statement of operations. The retention payments were determined to be for the benefit of Lantheus Holdings and will be recorded as post-combination compensation expense in Lantheus Holdings’ consolidated statement of operations. Refer to “Interests of Progenics’ Directors and Executive Officers in the Merger—Retention Payment Agreements” beginning on page 213 of the accompanying joint proxy statement/prospectus for a more detailed explanation.

 

(h)

Stockholders’ equity

Reflects the adjustment to eliminate Progenics’ historical stockholders’ equity.

 

(i)

Goodwill

Reflects the recognition of $32.2 million of goodwill as a result of the merger, which represents the excess of the preliminary consideration transferred over the fair value of the assets acquired and liabilities assumed. Refer to Note 5(d) above for additional information, including calculation of the pro forma adjustment to goodwill of $14.4 million.

 

(j)

Equity Issuance Costs

Reflects the adjustment to record $2.1 million of equity issuance costs that are specific, incremental costs related to issuing equity in conjunction with the merger as outlined in Note 1. Of this amount, $1.5 million had been capitalized on the historical Lantheus Holdings balance sheet as of December 31, 2019 and has been reclassified from other current assets to additional paid-in capital. In addition, $0.6 million of estimated incremental equity issuance costs necessary to effect the merger have been recorded as an increase to accrued expenses and other liabilities and a decrease to additional paid-in capital in the unaudited pro forma condensed combined balance sheet.

 

7.

Pro forma adjustments to the unaudited pro forma condensed combined statement of operations in connection with the merger

The unaudited pro forma condensed combined statement of operations reflects the proposed combination of Lantheus Holdings and Progenics using the acquisition method of accounting as of January 1, 2019. This note

 

69


Table of Contents

should be read in conjunction with “Note 1. Description of the merger,” “Note 2. Basis of presentation” and “Note 5. Estimate of consideration expected to be transferred in the merger and preliminary purchase price allocation.”

Adjustments included in the column under the heading “Pro forma adjustments” represent the following:

 

(a)

Transaction costs

Reflects the adjustment to eliminate the transaction costs incurred by Lantheus Holdings and Progenics related to the merger of $11.5 million that were incurred for the year ended December 31, 2019. As there is no continuing impact, the impact of these costs is not included in the unaudited pro forma condensed combined statement of operations. The impact of the incremental transaction costs accrued for on the unaudited pro forma condensed combined balance sheet in Note 6(f) above are not included in the unaudited pro forma condensed combined statements of operations as they have no continuing impact on the combined company.

 

(b)

Amortization of intangibles

Reflects the adjustment to amortization expense to:

 

  (i)

include an estimate of intangible asset amortization based on the straight-line method for acquired definite-lived intangible assets of $14.5 million for the year ended December 31, 2019 within cost of goods sold; and

 

  (ii)

eliminate Progenics’ historical intangible asset amortization expense of $1.1 million for the year ended December 31, 2019 within general and administrative expenses.

As IPR&D intangible assets are indefinite-lived intangible assets, no amortization related to IPR&D is reflected in the unaudited pro forma condensed combined statement of operations. See Note 5(b) above for additional information.

 

(c)

Leasing

Reflects the adjustment of incremental rent expense of $0.7 million for the year ended December 31, 2019 related to the leases acquired from Progenics as if the leases were new leases of Lantheus Holdings at the acquisition date in accordance with acquisition accounting.

 

(d)

Stock-based compensation expense

Reflects the adjustment to reduce stock-based compensation expense by $2.8 million for the year ended December 31, 2019, which related to the replacement options issued to existing Progenics optionholders. The aggregate fair value of those awards, totaling $10.3 million, was determined using the Black-Scholes option pricing model using a stock price of $15.55 per share, which was the last reported sale price of Lantheus Holdings common stock on February 28, 2020. Of that amount, $6.7 million relates to the fair value of the replacement awards for precombination services and was allocated to purchase consideration. Additionally, $3.6 million was excluded from purchase consideration and will be recognized as compensation expense in the post-combination period over the remaining service periods of the related awards. Refer to the table below for a summary of the line items within the unaudited pro forma condensed combined statement of operations that reflect this adjustment (in thousands):

 

     Year ended December 31,
2019
 

Research and development expenses

   $ (1,124

General and administrative expenses

     (1,265

Sales and marketing expenses

     (400
  

 

 

 

Total adjustment to stock-based compensation expense

   $ (2,789
  

 

 

 

 

70


Table of Contents
(e)

Income taxes

Reflects the income tax effects of the pro forma adjustments based on an estimated blended statutory tax rate of 25.68% in effect for the year ended December 31, 2019 as well as income tax adjustments for Progenics losses that could not be benefited previously due to its valuation allowance in the periods presented. The effective tax rate of the combined company could be significantly different than the estimated blended statutory tax rate assumed for purposes of preparing the unaudited pro forma condensed combined financial statements. Refer to Note 5(c) above for additional information.

 

(f)

Weighted-average number of shares and net income (loss) per share

The unaudited pro forma combined basic net income (loss) per share for the periods presented have been adjusted by the 26,833,853 Lantheus Holdings common shares expected to be issued in connection with the merger, which are assumed outstanding for the year ended December 31, 2019 for pro forma purposes. The unaudited pro forma diluted net income (loss) per share for the year ended December 31, 2019 is equal to the unaudited pro forma basic net income (loss) per share due to the combined company’s pro forma net loss. The weighted average common shares outstanding used to compute diluted net income (loss) per share for the year ended December 31, 2019 have been adjusted by 1,125,000 shares due to the net loss reported in those periods on a pro forma basis.

 

8.

Items not included in the unaudited pro forma condensed combined financial statements

The unaudited pro forma condensed combined statement of operations does not include the impacts of any revenue, cost or other operating synergies that may result from the merger or any related restructuring costs that may be contemplated.

The unaudited pro forma condensed combined statement of operations does not include any non-recurring transaction costs incurred by Lantheus Holdings or Progenics after December 31, 2019 as those costs are not expected to have a continuing impact on the operations of the combined business.

The unaudited pro forma condensed combined statement of operations does not include an adjustment for $3.0 million of retention payments to be paid to certain employees of Progenics contingent upon their continued employment as those expenses are not expected to have a continuing impact on the operations of the combined business. The unaudited pro forma condensed combined balance sheet does not include an adjustment for $1.5 million of retention payments to be paid to certain employees of Progenics contingent upon their continued employment through a specified period of six months after the closing date of the merger as that expense will begin to accrue upon the closing of the merger.

The unaudited pro forma condensed combined statement of operations does not include the impacts of any amortization related to the IPR&D intangible assets as these assets are indefinite-lived intangible assets. Upon successful completion of the development process for an acquired IPR&D project, determination as to the useful life of the asset will be made; at that point in time, the asset would then be considered a finite-lived intangible asset and Lantheus Holdings would begin to amortize the asset into earnings over its estimated useful life.

 

71


Table of Contents

COMPARATIVE PER SHARE MARKET PRICE AND DIVIDEND INFORMATION

Market Prices

The shares of Lantheus Holdings common stock are traded on the Nasdaq Global Market under the symbol “LNTH” and the shares of Progenics common stock are traded on the Nasdaq Stock Market under the symbol “PGNX.” The following table sets forth, for the calendar periods indicated, the high and low sales prices per share of Lantheus Holdings common stock as reported on the Nasdaq Global Market and the high and low sales prices per share of Progenics common stock as reported on the Nasdaq Stock Market.

 

     Shares of Lantheus Holdings
Common Stock
     Shares of Progenics
Common Stock
 
         High              Low              High              Low      

2016:

           

First Calendar Quarter

   $ 3.38      $ 1.76      $ 6.13      $ 3.61  

Second Calendar Quarter

     4.37        1.82        5.75        4.00  

Third Calendar Quarter

     10.10        3.46        7.09        4.19  

Fourth Calendar Quarter

     10.85        7.61        9.78        4.84  

2017:

           

First Calendar Quarter

   $ 14.25      $ 7.95      $ 11.72      $ 8.15  

Second Calendar Quarter

     17.85        10.65        9.56        6.10  

Third Calendar Quarter

     20.45        15.05        7.39        4.60  

Fourth Calendar Quarter

     24.10        17.15        7.81        5.16  

2018:

           

First Calendar Quarter

   $ 24.45      $ 14.45      $ 8.63      $ 5.01  

Second Calendar Quarter

     19.95        13.55        9.12        6.48  

Third Calendar Quarter

     16.60        12.80        9.42        5.45  

Fourth Calendar Quarter

     19.31        12.59        6.54        3.62  

2019:

           

First Calendar Quarter

   $ 25.49      $ 14.57      $ 5.00      $ 3.96  

Second Calendar Quarter

     28.48        23.23        6.19        4.02  

Third Calendar Quarter

     29.80        20.33        6.31        3.42  

Fourth Calendar Quarter

     25.33        17.85        6.37        4.58  

2020:

           

First Calendar Quarter (through March 18, 2020)

   $ 20.67      $ 8.67      $ 5.37      $ 2.06  

The following table sets forth the closing sale price per share of Lantheus Holdings common stock as reported on the Nasdaq Global Market and closing sale price per share of Progenics common stock as reported on the Nasdaq Stock Market on February 19, 2020, the last trading day prior to the public announcement of the merger agreement, and on March 18, 2020, the most recent trading day prior to the date of this joint proxy statement/prospectus for which this information was available. The table also shows the implied value of the merger consideration for each share of Progenics common stock. This implied value was calculated by multiplying the closing sale price of a share of Lantheus Holdings common stock on the relevant date by the exchange ratio.

 

     Shares of
Lantheus
Holdings
Common Stock
     Shares of
Progenics
Common Stock
     Implied Per Share
Value of Merger
Consideration
 

February 19, 2020

   $ 16.53      $ 4.55      $ 5.12  

March 18, 2020

   $ 9.11      $ 2.15      $ 2.82  

The market prices of shares of Lantheus Holdings common stock and shares of Progenics common stock have fluctuated since the date of the announcement of the merger agreement and will continue to fluctuate from the date of this joint proxy statement/prospectus to the dates of the Lantheus Holdings special meeting and the

 

72


Table of Contents

Progenics special meeting and the date the merger is completed. No assurance can be given concerning the market prices of shares of Lantheus Holdings common stock or shares of Progenics common stock before completion of the merger or shares of Lantheus Holdings common stock after completion of the merger. The exchange ratio is fixed in the merger agreement, but the market price of shares of Lantheus Holdings common stock (and therefore the value of the stock consideration) when received by Progenics stockholders after the merger is completed could be greater than, less than or the same as shown in the table above. Accordingly, Progenics stockholders are advised to obtain current market quotations for shares of Lantheus Holdings common stock and shares of Progenics common stock in deciding whether to vote for adoption of the merger agreement.

This information should be read together with the consolidated financial statements and related notes of Lantheus Holdings and Progenics that are incorporated by reference in this document and with the unaudited pro forma combined financial data included under the section titled “Certain Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 59 of this joint proxy statement/prospectus.

Dividends

Since becoming a publicly traded company in 2015, Lantheus Holdings has never declared or paid any cash dividends on shares of Lantheus Holdings common stock. Under the terms of the merger agreement, during the period before completion of the merger, Lantheus Holdings is not permitted to declare, set aside, make or pay any dividend or other distribution, other than dividends or distributions by wholly-owned subsidiaries of Lantheus Holdings to Lantheus Holdings or another wholly-owned subsidiary of Lantheus Holdings.

Progenics has never declared or paid any cash dividends on shares of Progenics common stock. Under the terms of the merger agreement, during the period before completion of the merger, Progenics is not permitted to declare, set aside, make or pay any dividend or other distribution, other than dividends or distributions by wholly-owned subsidiaries of Progenics to Progenics or another wholly-owned subsidiary of Progenics.

After completion of the merger, each former Progenics stockholder who holds shares of Lantheus Holdings common stock into which shares of Progenics common stock have been converted in connection with the merger will receive all dividends or other distributions declared and paid on shares of Lantheus Holdings common stock with a record date on or after the completion of the merger. However, no dividend or other distribution having a record date after completion of the merger will actually be paid with respect to any shares of Lantheus Holdings common stock into which shares of Progenics common stock have been converted in connection with the merger until the certificates formerly representing shares of Progenics common stock have been surrendered or the book-entry shares formerly representing shares of Progenics common stock have been transferred to the exchange agent in accordance with the merger agreement, at which time any such accrued dividends and other distributions on those shares of Lantheus Holdings common stock will be paid without interest. Subject to the limitations set forth in the merger agreement described above, any future dividends by Lantheus Holdings will be made at the discretion of the Lantheus Holdings Board. Subject to the limitations set forth in the merger agreement described above, any future dividends by Progenics will be made at the discretion of the Progenics Board. There can be no assurance that any future dividends will be declared or paid by Lantheus Holdings or Progenics or as to the amount or timing of those dividends, if any.

 

73


Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This joint proxy statement/prospectus (including information included or incorporated by reference herein) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current plans, estimates and expectations that are subject to various risks and uncertainties. The inclusion of forward-looking statements should not be regarded as a representation that such plans, estimates and expectations will be achieved. Words such as “anticipates,” “expects,” “projects,” “intends,” “believes,” “may,” “will,” “should,” “could,” “targets,” “plans,” “contemplates,” “estimates,” “seeks,” “predicts,” “potential,” “opportunity,” “creates” and words and terms of similar substance used in connection with any discussion of future plans, actions or events identify forward-looking statements. All statements, other than historical facts, including the expected timing of the closing of the merger; the ability of the parties to complete the merger considering the various closing conditions; the expected benefits of the merger, such as efficiencies, cost savings, synergies, revenue growth, creating shareholder value, growth potential, market profile, enhanced competitive position, and financial strength and flexibility; the competitive ability and position of the combined company; and any assumptions underlying any of the foregoing, are forward-looking statements.

Important factors that could cause actual results to differ materially from Lantheus Holdings’ and Progenics’ plans, estimates or expectations could include, but are not limited to, the following:

 

   

the risk that Lantheus Holdings stockholders do not approve the stock issuance proposal;

 

   

the risk that Progenics stockholders do not approve the merger agreement proposal;

 

   

the risk that the merger is subject to required governmental and regulatory approvals and that governmental and regulatory authorities may impose conditions that could have an adverse effect on Lantheus Holdings, Progenics or the combined company;

 

   

the risk that the conditions to the closing of the merger may not be satisfied;

 

   

the effect of the announcement of the merger on the ability of Lantheus Holdings or Progenics to retain and hire key personnel and maintain relationships with customers, suppliers and others with whom Lantheus Holdings or Progenics does business, or on Lantheus Holdings’ or Progenics’ operating results and business generally;

 

   

Lantheus Holdings or Progenics’ respective businesses may suffer as a result of uncertainty surrounding the merger and disruption of management’s attention due to the merger;

 

   

that the merger agreement limits the ability of the parties to pursue alternatives to the merger;

 

   

the risk that potential litigation in connection with the merger may affect the timing or occurrence of the merger or result in significant costs;

 

   

the risk that the merger may not be accretive and may cause dilution to Lantheus Holdings’ earnings per share, which may negatively affect the market price of its common stock;

 

   

risks that the CVRs to be issued by Lantheus Holdings as part of the merger consideration may result in substantial future payments and could divert the attention of Lantheus Holdings management;

 

   

risks that in connection with the merger, the exercise of appraisal rights by dissenting stockholders could increase the aggregate amount Lantheus Holdings will have to pay for Progenics;

 

   

risks that the anticipated benefits of the merger or other commercial opportunities may not be fully realized or may take longer to realize than expected;

 

   

the risk that the merger may involve unexpected costs, liabilities or delays;

 

   

risks relating to the tax treatment of the merger;

 

74


Table of Contents
   

the risk that the combined company may be unable to successfully integrate the Progenics business into the Lantheus Holdings business and realize the anticipated benefits of the merger;

 

   

unanticipated risks to integration, including in connection with timing, talent and the potential need for additional resources;

 

   

new or previously unidentified manufacturing, regulatory, or research and development issues in the Progenics business;

 

   

the impact of legislative, regulatory, competitive and technological changes;

 

   

that the combined company is expected to incur substantial expenses related to the completion of the merger and integration of the Progenics business;

 

   

Lantheus Holdings or Progenics may be adversely affected by other economic, business, and/or competitive factors;

 

   

risks associated with global public health emergencies, including the recent COVID-19 (coronavirus) outbreak, which could adversely affect manufacturing and supply chains for radioisotopes and other critical materials, logistics, distribution channels, radiopharmacies, the hospitals and clinics at which the products of Lantheus Holdings or Progenics are used or tested or the medical procedures in which those products are used or tested and the recruitment for and conduct of clinical trials;

 

   

the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; and

 

   

other risks to the completion of the merger, including the risk that the merger will not be completed within the expected time period or at all.

The foregoing list sets forth some, but not all, of the factors that could have an impact upon Lantheus Holdings’ and Progenics’ ability to achieve results described in any forward-looking statements. A further list and description of these and other factors can be found in the section entitled “Risk Factors” beginning on page 41 of this joint proxy statement/prospectus and elsewhere in this joint proxy statement/prospectus. In addition, all of the forward-looking statements Lantheus Holdings or Progenics make in this document are qualified by the information incorporated by reference into this joint proxy statement/prospectus, including, but not limited to (i) the information contained under this heading and (ii) the information discussed under the sections entitled “Risk Factors” in Lantheus Holdings’ Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and in Progenics’ Annual Report on Form 10-K for the fiscal year ended December 31, 2019. See the section entitled “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

It should also be noted that projected financial information for the combined businesses of Lantheus Holdings and Progenics is based on management’s estimates, assumptions and projections and has not been prepared in conformance with the applicable accounting requirements of Regulation S-X of the Exchange Act relating to pro forma financial information, and the required pro forma adjustments have not been applied and are not reflected therein. None of this information should be considered in isolation from, or as a substitute for, the historical financial statements of Lantheus Holdings or Progenics.

Persons reading this joint proxy statement/prospectus are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are and will be based upon management’s then-current views and assumptions regarding future events and operating performance, and are applicable only as of the dates of such statements. You also should understand that it is not possible to predict or identify all such factors and that this list should not be considered a complete statement of all potential risks and uncertainties. Investors also should realize that if underlying assumptions prove inaccurate or if unknown risks or uncertainties materialize, actual results could vary materially from Lantheus Holdings’ or Progenics’ projections. Except as otherwise required by law, neither Lantheus Holdings nor Progenics is under any obligation, and each expressly disclaim any obligation, to update, alter, or otherwise revise any forward-looking statements included in this joint proxy statement/prospectus or elsewhere, whether written or oral, that may be made from time to time relating to any of

 

75


Table of Contents

the matters discussed in this joint proxy statement/prospectus, whether as a result of new information, future events or otherwise, as of any future date.

TRADEMARKS

Lantheus Holdings and Progenics each own or have the rights to various trademarks, service marks and trade names referred to in this joint proxy statement/prospectus. Solely for convenience, such trademarks, service marks and trade names are referred to in this joint proxy statement/prospectus without the TM, SM and ® symbols. Such references are not intended to indicate, in any way, that Lantheus Holdings or Progenics will not assert, to the fullest extent permitted under applicable law, its rights to its trademarks, service marks and trade names.

 

76


Table of Contents

THE COMPANIES

Lantheus Holdings

Lantheus Holdings was incorporated under the laws of the State of Delaware in November 2007 under the name ACP Lantern Holdings, Inc. In 2008, ACP Lantern Holdings, Inc. changed its name to Lantheus MI Holdings, Inc. and, in 2014, changed its name again to Lantheus Holdings, Inc. Lantheus Holdings is a leader in the development, manufacturing, and commercialization of innovative diagnostic medical imaging agents and products across a range of imaging modalities, including echocardiography and nuclear imaging. Its commercial products are used by cardiologists, nuclear physicians, radiologists, internal medicine physicians, technologists and sonographers working in a variety of clinical settings.

Lantheus Holdings’ portfolio of commercial products includes DEFINITY, the leading ultrasound contrast imaging agent based on revenue and usage in the U.S., and TechneLite, a self-contained system or generator of technetium-99m, a radioactive isotope used by radiopharmacies to prepare various nuclear imaging agents. Since its launch in 2001, DEFINITY has been used in imaging procedures in more than 13.8 million patients throughout the world. Additionally, as of December 31, 2019, Lantheus Holdings estimates that TechneLite had approximately one third of the U.S. technetium generator market.

Lantheus Holdings common stock, par value $0.01 per share, (NASDAQ: LNTH) is listed on the Nasdaq Global Market under the symbol “LNTH.” The principal executive offices of Lantheus Holdings are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862; its telephone number is (978) 671-8001; and its website is www.lantheus.com. Information on Lantheus Holdings’ Internet website is not incorporated by reference into or otherwise part of this joint proxy statement/prospectus.

This joint proxy statement/prospectus incorporates important business and financial information about Lantheus Holdings from other documents that are not included in or delivered with this joint proxy statement/prospectus. For a list of the documents that are incorporated by reference, see “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

Progenics

Progenics, which has been listed on Nasdaq since 1997, was incorporated in Delaware in 1986, commenced principal operations in 1988, and throughout has been engaged primarily in research and development efforts, establishing corporate collaborations and related activities. Progenics is an oncology company focused on the development and commercialization of innovative targeted medicines and artificial intelligence to find, fight and follow cancer. Progenics’ pipeline includes therapeutic agents designed to precisely target cancer (AZEDRA, 1095 and PSMA TTC), as well as a prostate-specific membrane antigen, which is referred to in this joint proxy statement/prospectus as PSMA, targeted imaging agents for prostate cancer (PyL and 1404).

Highlights of Progenics’ recent progress include the enrollment completion of Progenics’ pivotal Phase 3 trial for PyL and the positive topline results.

Progenics common stock, par value $0.0013 per share, is listed on the Nasdaq Stock Market under the symbol “PGNX.” The principal executive offices of Progenics are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007; its telephone number is (646) 975-2500; and its website is www.progenics.com. Information on Progenics’ Internet website is not incorporated by reference into or otherwise part of this joint proxy statement/prospectus.

This joint proxy statement/prospectus incorporates important business and financial information about Progenics from other documents that are not included in or delivered with this joint proxy statement/prospectus. For a list of the documents that are incorporated by reference, see “Where You Can Find More Information” beginning on page 260 of this joint proxy statement/prospectus.

 

77


Table of Contents

Plato Merger Sub, Inc.

Merger Sub was incorporated under the laws of the State of Delaware on September 26, 2019, and is a wholly-owned subsidiary of Lantheus Holdings. Merger Sub was formed solely for the purpose of completing the merger. Merger Sub has not carried on any activities or operations to date, except for activities incidental to its formation and activities undertaken in connection with the merger. By operation of the merger, Merger Sub will be merged with and into Progenics, with Progenics surviving the merger as a wholly-owned subsidiary of Lantheus Holdings.

The principal executive offices of Merger Sub are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, and its telephone number is (978) 671-8001.

 

78


Table of Contents

SPECIAL MEETING OF STOCKHOLDERS OF LANTHEUS HOLDINGS

Lantheus Holdings is providing this joint proxy statement/prospectus to its stockholders in connection with the solicitation of proxies to be voted at the Lantheus Holdings special meeting of stockholders (or any adjournment or postponement thereof) that Lantheus Holdings has called to consider and vote on a proposal to approve the stock issuance and a proposal to approve the adjournment from time to time of the Lantheus Holdings special meeting if necessary to solicit additional proxies if there are not sufficient votes at the time of the Lantheus Holdings special meeting, or any adjournment or postponement thereof, to approve the stock issuance.

Date, Time and Location

Together with this joint proxy statement/prospectus, Lantheus Holdings is also sending Lantheus Holdings stockholders a notice of the Lantheus Holdings special meeting and a form of proxy card that is solicited by the Lantheus Holdings Board for use at the Lantheus Holdings special meeting to be held at the principal executive offices of Lantheus Holdings, which are located at 331 Treble Cove Road, North Billerica, Massachusetts 01862, on April 28, 2020, at 11:15 a.m., Eastern Time, and any adjournments or postponements of the Lantheus Holdings special meeting.

If you plan to attend the Lantheus Holdings special meeting, you will need to provide evidence that you are a stockholder as of the close of business on the record date. This can be a copy of your proxy card or a brokerage statement showing your shares as of the close of business on the record date. You should also bring photo identification. If you hold your shares in street name and wish to vote in person at the meeting, you will need to contact the broker, bank or other nominee that holds your shares in order to obtain a legal proxy from that broker, bank or other nominee to present at the special meeting.

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on shareholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this proxy statement. We encourage you to vote your shares prior to the Lantheus Holdings special meeting.

Purpose

At the Lantheus Holdings special meeting, Lantheus Holdings stockholders will be asked to consider and vote on the following proposals:

 

   

the stock issuance proposal; and

 

   

the Lantheus Holdings adjournment proposal.

Under Lantheus Holdings’ by-laws, the business to be conducted at the Lantheus Holdings special meeting will be limited to the proposals set forth in the notice to Lantheus Holdings stockholders provided with this joint proxy statement/prospectus.

Recommendation of the Lantheus Holdings Board of Directors

For the reasons set forth in this joint proxy statement/prospectus, the Lantheus Holdings Board unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the stock issuance, are advisable, fair to and in the best interests of Lantheus Holdings and its stockholders. The Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote FOR the stock issuance proposal. For the factors considered by the Lantheus Holdings

 

79


Table of Contents

Board in reaching this decision, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Lantheus Holdings’ Reasons for the Merger; Recommendation of the Lantheus Holdings Board of Directors that Lantheus Holdings Stockholders Approve the Stock Issuance” beginning on page 127 of this joint proxy statement/prospectus.

In addition, the Lantheus Holdings Board unanimously recommends that Lantheus Holdings stockholders vote “FOR” the Lantheus Holdings adjournment proposal. See “Lantheus Holdings Proposal II: Adjournment of the Lantheus Holdings Special Meeting” beginning on page 216 of this joint proxy statement/prospectus.

Lantheus Holdings Record Date; Outstanding Shares; Stockholders Entitled to Vote

The Lantheus Holdings Board has fixed the close of business on March 18, 2020 as the record date for the determination of the Lantheus Holdings stockholders entitled to notice of and to vote at the Lantheus Holdings special meeting or any adjournment or postponement of the Lantheus Holdings special meeting. Only Lantheus Holdings stockholders of record at the record date are entitled to receive notice of, and to vote at, the Lantheus Holdings special meeting or any adjournment or postponement thereof. As of the close of business on the record date, there were 39,716,519 shares of Lantheus Holdings common stock, $0.01 par value per share, outstanding and entitled to vote at the Lantheus Holdings special meeting. Each holder of shares of Lantheus Holdings common stock is entitled to one vote for each share of Lantheus Holdings common stock owned at the record date.

Quorum

The presence at the Lantheus Holdings special meeting, in person or by proxy, of the holders of a majority of the outstanding shares of Lantheus Holdings common stock at the record date (the close of business on March 18, 2020) and entitled to vote at the meeting will constitute a quorum. Elections to abstain from voting will be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum. Shares of Lantheus Holdings common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to its broker, bank or other nominee, and shares of Lantheus Holdings common stock with respect to which the beneficial owner otherwise fails to vote, will not be deemed present at the Lantheus Holdings special meeting for the purpose of determining the presence of a quorum. There must be a quorum for the vote on the stock issuance proposal to be taken at the Lantheus Holdings special meeting. Failure of a quorum to be present at the Lantheus Holdings special meeting will necessitate an adjournment of the meeting by the Chairperson of the meeting and will subject Lantheus Holdings to additional expense.

Required Vote

The affirmative vote of at least a majority of the votes cast by holders of outstanding shares of Lantheus Holdings common stock at a duly called and held meeting of Lantheus Holdings stockholders at which a quorum is present is required to approve the stock issuance proposal in connection with the merger. Lantheus Holdings cannot complete the merger unless its stockholders approve the stock issuance proposal. A majority of the votes cast means that the number of votes cast “for” the stock issuance proposal must exceed the number of votes cast “against.” A Lantheus Holdings stockholder’s abstention from voting, the failure of a Lantheus Holdings stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of the stock issuance proposal, except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

Approval of the Lantheus Holdings adjournment proposal, assuming a quorum is present, requires the affirmative vote of the holders of a majority of the shares of Lantheus Holdings common stock present in person or represented by proxy at the Lantheus Holdings special meeting and entitled to vote thereat. A Lantheus Holdings stockholder’s abstention from voting on the Lantheus Holdings adjournment proposal will have the same effect as a vote “AGAINST” the approval of this proposal. The failure of a Lantheus Holdings stockholder who holds

 

80


Table of Contents

his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Lantheus Holdings stockholder to vote, will have no effect on the approval of the Lantheus Holdings adjournment proposal, except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

Stock Ownership of and Voting by Lantheus Holdings Directors and Executive Officers

As of the close of business on the record date, Lantheus Holdings’ directors and executive officers and their affiliates beneficially owned and had the right to vote in the aggregate 589,968 shares of Lantheus Holdings common stock at the Lantheus Holdings special meeting, which represents approximately 1.5% of the shares of Lantheus Holdings common stock entitled to vote at the Lantheus Holdings special meeting. Each of Lantheus Holdings’ directors and executive officers is expected, as of the date of this joint proxy statement/prospectus, to vote his or her shares of Lantheus Holdings common stock “FOR” the stock issuance proposal and “FOR” the Lantheus Holdings adjournment proposal, although none of Lantheus Holdings’ directors or executive officers has entered into any agreement requiring them to do so.

Voting of Shares

Via the Internet or by Telephone

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, you may vote via the Internet or by telephone by following the instructions on the enclosed proxy card. In order to vote your shares via the Internet or by telephone, you will need the control number on your proxy card (which is unique to each Lantheus Holdings stockholder to ensure all voting instructions are genuine and to prevent duplicate voting).

If you hold shares of Lantheus Holdings common stock in “street name” through a broker, bank or other nominee, you may provide voting instructions via the Internet or by telephone only if Internet or telephone voting is made available by your broker, bank or other nominee. Please follow the voting instructions provided by your broker, bank or other nominee with these materials.

By Mail

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, in order to vote by mail, you may submit a proxy card. You will need to complete, sign and date your proxy card and return it using the postage-paid return envelope provided.

If you hold shares of Lantheus Holdings common stock in “street name” through a broker, bank or other nominee, in order to provide voting instructions by mail you will need to complete, sign and date the voting instruction form provided by your broker, bank or other nominee with these materials and return it in the postage-paid return envelope provided. Your broker, bank or other nominee must receive your voting instruction form in sufficient time to vote your shares.

In Person

If you hold shares of Lantheus Holdings common stock directly in your name as a stockholder of record, you may vote in person at the Lantheus Holdings special meeting. Stockholders of record also may be represented by another person at the Lantheus Holdings special meeting by executing a proper proxy designating that person and having that proper proxy be presented to the inspectors of election with the applicable ballot at the Lantheus Holdings special meeting.

If you hold shares of Lantheus Holdings common stock in “street name,” meaning through a broker, bank or other nominee, you must obtain a written legal proxy from that broker, bank or other nominee and present it to the inspectors of election with your ballot to be able to vote in person at the Lantheus Holdings special meeting. To request a legal proxy, please contact your broker, bank or other nominee.

 

81


Table of Contents

Generally

If you hold shares of Lantheus Holdings common stock in “street name” through a broker, bank or other nominee, you must obtain a written legal proxy from that broker, bank or other nominee and present it to the inspectors of election with your ballot to be able to vote in person at the Lantheus Holdings special meeting. To request a legal proxy, please contact your broker, bank or other nominee.

If your shares of Lantheus Holdings common stock are held in an account at a broker, bank or other nominee, you must instruct the broker, bank or other nominee on how to vote your shares. In general, in accordance with applicable stock exchange rules, if your shares of Lantheus Holdings common stock are held in “street name” and you do not instruct your broker how to vote your shares, your broker, in its discretion, may either leave your shares unvoted or vote your shares on routine matters. However, a broker is precluded from exercising its voting discretion with respect to non-routine or “significant” matters, such as the approval of the stock issuance proposal and the approval of the Lantheus Holdings adjournment proposal. None of the proposals at the Lantheus Holdings special meeting are routine matters. As a result, if you hold your shares in “street name,” through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the Lantheus Holdings special meeting.

If a beneficial owner of shares of Lantheus Holdings common stock held in “street name” does not give voting instructions to its broker, bank or other nominee, then those shares will not be present in person or represented by proxy at the Lantheus Holdings special meeting. A beneficial owner’s failure to instruct its broker, bank or other nominee how to vote shares of Lantheus Holdings common stock held in “street name” will have no effect on the approval of the stock issuance proposal or the Lantheus Holdings adjournment proposal, except to the extent it results in there being insufficient shares present at the Lantheus Holdings special meeting to establish a quorum.

All shares represented by each properly completed and valid proxy received before or at the Lantheus Holdings special meeting will be voted in accordance with the instructions given in the proxy. If a Lantheus Holdings stockholder signs a proxy card and returns it without giving instructions for voting on any proposal, the shares of Lantheus Holdings common stock represented by that proxy card will be voted “FOR” the stock issuance proposal and “FOR” the Lantheus Holdings adjournment proposal.

Your vote is very important, regardless of the number of shares you own. Whether or not you expect to attend the Lantheus Holdings special meeting in person, please vote or otherwise submit a proxy to vote your shares as promptly as possible so that your shares may be represented and voted at the Lantheus Holdings special meeting. If your shares of Lantheus Holdings common stock are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction form furnished to you by such bank, broker or other nominee.

Revocability of Proxies; Changing Your Vote

You may change your vote or revoke your proxy at any time before your proxy is voted at the Lantheus Holdings special meeting. You may revoke the authority granted by your proxy at any time prior to its use by:

 

   

sending a written revocation of a proxy to 331 Treble Cove Road, North Billerica, Massachusetts 01862, Attention: Investor Relations, that bears a date later than the date of the proxy you want to revoke and is received prior to the date of the Lantheus Holdings special meeting;

 

   

submitting a valid, later-dated proxy or voting instructions via the Internet or by telephone before 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Lantheus Holdings special meeting, or by mail that is received prior to the Lantheus Holdings special meeting; or

 

   

attending the Lantheus Holdings special meeting (or, if the special meeting is adjourned or postponed, attending the applicable adjourned or postponed meeting) and voting in person, which automatically will cancel any proxy previously given, or revoking your proxy in person, but your attendance alone will not revoke any proxy previously given.

 

82


Table of Contents

If you hold your shares in “street name” through a broker, bank or other nominee, you must contact your broker, bank or other nominee to change your vote or obtain a written legal proxy to vote your shares if you wish to cast your vote in person at the Lantheus Holdings special meeting.

All shares that have been properly voted and not revoked will be voted at the special meeting.

Solicitation of Proxies; Expenses of Solicitation

This joint proxy statement/prospectus is being provided to holders of shares of Lantheus Holdings common stock in connection with the solicitation of proxies by the Lantheus Holdings Board to be voted at the Lantheus Holdings special meeting and at any adjournments or postponements thereof. Lantheus Holdings will bear all costs and expenses in connection with the solicitation of proxies, including the costs of filing, printing and mailing this joint proxy statement/prospectus for the Lantheus Holdings special meeting. Lantheus Holdings has engaged Innisfree M&A Incorporated to assist in the solicitation of proxies for the Lantheus Holdings special meeting and will pay Innisfree M&A Incorporated a fee of $25,000 for services in connection with the Lantheus Holdings special meeting.

In addition to solicitation by mail, directors, officers and employees of Lantheus Holdings or its subsidiaries may solicit proxies from stockholders by telephone, telegram, email, personal interview or other means. Lantheus Holdings currently expects not to incur any costs beyond those customarily expended for a solicitation of proxies in connection with approval of any issuance of shares of Lantheus Holdings common stock. Directors, officers and employees of Lantheus Holdings will not receive additional compensation for their solicitation activities, but may be reimbursed for reasonable out-of-pocket expenses incurred by them in connection with the solicitation. Brokers, dealers, commercial banks, trust companies, fiduciaries, custodians and other nominees have been requested to forward proxy solicitation materials to their customers, and such nominees will be reimbursed for their reasonable out-of-pocket expenses. Lantheus Holdings will pay the costs associated with the Lantheus Holdings special meeting and solicitation of proxies, including the costs of mailing the proxy materials.

Householding

“Householding” is a procedure Lantheus Holdings adopted whereby stockholders of record who have the same last name and address and who receive the proxy materials by mail will receive only one copy of the proxy materials unless Lantheus Holdings has received contrary instructions from one or more of the stockholders. This procedure reduces printing and mailing costs.

If you wish to receive a separate copy of the proxy materials, now or in the future, at the same address, or if you are currently receiving multiple copies of the proxy materials at the same address and wish to receive a single copy, you may contact Lantheus Holdings’ Investor Relations department at (978)-671-8842 or ir@lantheus.com, or by writing to Lantheus Holdings, Inc., 331 Treble Cove Road, North Billerica, Massachusetts 01862, Attention: Investor Relations.

If you are a beneficial owner (your shares are held in the name of a bank, broker or other nominee), the bank, broker or other nominee may deliver only one copy of the joint proxy statement/prospectus to stockholders who have the same address unless the bank, broker or other nominee has received contrary instructions from one or more of the stockholders. If you wish to receive a separate copy of the joint proxy statement/prospectus now or in the future, you may contact Lantheus Holdings at the address or phone number above and Lantheus Holdings will promptly deliver a separate copy. Beneficial owners sharing an address who are currently receiving multiple copies of the joint proxy statement/prospectus and wish to receive a single copy in the future, should contact their bank, broker or other nominee to request that only a single copy be delivered to all stockholders at the shared address in the future.

 

83


Table of Contents

Adjournment

Lantheus Holdings stockholders are being asked to approve a proposal that will give the Lantheus Holdings Board authority to adjourn the Lantheus Holdings special meeting from time to time for the purpose of soliciting additional proxies in favor of the stock issuance proposal if there are not sufficient votes at the time of the Lantheus Holdings special meeting, or any adjournment or postponement thereof, to approve the stock issuance proposal. If the Lantheus Holdings adjournment proposal is approved, the Lantheus Holdings special meeting

could be adjourned to any date. In addition, the Lantheus Holdings Board, with or without stockholder approval, could postpone the Lantheus Holdings special meeting before it commences, whether for the purpose of soliciting additional proxies or for other reasons. If the Lantheus Holdings special meeting is adjourned for the purpose of soliciting additional proxies, stockholders who have already submitted their proxies will be able to revoke them at any time prior to their use. If you sign and return a proxy and do not indicate how you wish to vote on any proposal, or if you indicate how you wish to vote on the stock issuance proposal and leave the other proposal blank, your shares will be voted in favor of the Lantheus Holdings adjournment proposal even if you voted against the stock issuance proposal.

Other Information

The matters to be considered at the Lantheus Holdings special meeting are of great importance to the stockholders of Lantheus Holdings. Accordingly, you are urged to read and carefully consider the information contained in or incorporated by reference into this joint proxy statement/prospectus and submit your proxy via the Internet or by telephone or complete, date, sign and promptly return the enclosed proxy card in the enclosed postage-paid envelope. If you submit your proxy via the Internet or by telephone, you do not need to return the enclosed proxy card.

Assistance

If you have any questions or require any assistance with authorizing a proxy or voting your shares, or if you need additional copies of the proxy materials, please contact:

 

 

LOGO

Innisfree M&A Incorporated

501 Madison Avenue, 20th Floor

New York, New York 10022

Telephone (Toll-Free): (877) 750-9497

International Callers: (412) 232-3651

Banks and brokers may call collect: (212) 750-5833

 

84


Table of Contents

SPECIAL MEETING OF STOCKHOLDERS OF PROGENICS

Progenics is providing this joint proxy statement/prospectus to its stockholders in connection with the solicitation of proxies to be voted at the Progenics special meeting of stockholders (or any adjournment or postponement thereof) that Progenics has called to consider and vote on (i) a proposal to adopt the merger agreement, (ii) a proposal to approve the adjournment from time to time of the Progenics special meeting if necessary to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the Progenics special meeting or any adjournment or postponement thereof and (iii) a proposal to approve, on an advisory (non-binding) basis, the compensation that will or may be paid or provided by Progenics to its named executive officers in connection with the merger.

Date, Time and Location

Together with this joint proxy statement/prospectus, Progenics is also sending Progenics stockholders a notice of the Progenics special meeting and a form of proxy card that is solicited by the Progenics Board for use at the Progenics special meeting to be held at the principal executive offices of Progenics, which are located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007 on April 28, 2020, at 10:15 a.m., Eastern Time, and any adjournments or postponements of the Progenics special meeting.

Only stockholders or their proxy holders may attend the Progenics special meeting. If you are attending the Progenics special meeting in person, you will be required to register as a stockholder or proxy holder and to show valid, government-issued identification before entering the Progenics special meeting.

As part of our precautions regarding the coronavirus (COVID-19), we are sensitive to the public health and travel concerns that our stockholders may have, as well as any protocols that federal, state and local governments may impose. In the event we determine it is necessary or appropriate to take additional steps regarding how we conduct our meeting, including by holding the meeting virtually over the Internet, we will announce this decision in advance, and details will be posted on our website and filed with the SEC. A virtual meeting will have no impact on stockholders’ ability to provide their proxy by using the Internet or telephone or by completing, signing, dating and mailing their proxy card, each as explained in this joint proxy statement/prospectus. We encourage you to vote your shares prior to the Progenics special meeting.

Purpose

At the Progenics special meeting, Progenics stockholders will be asked to consider and vote on the following proposals:

 

   

the merger agreement proposal;

 

   

the Progenics adjournment proposal; and

 

   

the Progenics compensation advisory proposal.

Recommendation of the Progenics Board of Directors

For the reasons set forth in this joint proxy statement/prospectus, the Progenics Board unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of Progenics and its stockholders. The Progenics Board unanimously recommends that Progenics stockholders vote FOR the merger agreement proposal. For the factors considered by the Progenics Board in reaching this decision, see “Lantheus Holdings Proposal I: Approval of the Stock Issuance and Progenics Proposal I: Adoption of the Merger Agreement—Progenics’ Reasons for the Merger; Recommendation of the Progenics Board of Directors that Progenics Stockholders Adopt the Merger Agreement” beginning on page 136 of this joint proxy statement/prospectus.

 

85


Table of Contents

The Progenics Board unanimously recommends that Progenics stockholders vote “FOR” the Progenics adjournment proposal. See “Progenics Proposal II: Adjournment of the Progenics Special Meeting” beginning on page 217 of this joint proxy statement/prospectus.

In addition, the Progenics Board unanimously recommends that Progenics stockholders vote “FOR” the Progenics compensation advisory proposal. See “Progenics Proposal III: Advisory Vote On Merger-Related Executive Compensation Arrangements” beginning on page 218 of this joint proxy statement/prospectus.

Progenics Record Date; Outstanding Shares; Stockholders Entitled to Vote

The Progenics Board set the close of business on March 18, 2020 as the record date for the determination of the Progenics stockholders entitled to notice of and to vote at the Progenics special meeting or any adjournment or postponement of the Progenics special meeting. Only Progenics stockholders of record at the record date are entitled to receive notice of, and to vote at, the Progenics special meeting or any adjournment or postponement of the Progenics special meeting. As of the close of business on the record date, there were 86,596,633 shares of Progenics common stock outstanding and entitled to vote at the Progenics special meeting. Each holder of shares of Progenics common stock is entitled to one vote for each share of Progenics common stock owned at the record date.

Quorum

The presence at the Progenics special meeting, in person or by proxy, of the holders of a majority of the outstanding shares of Progenics common stock at the record date (the close of business on March 18, 2020) and entitled to vote at the meeting will constitute a quorum. Elections to abstain from voting will be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum. Shares of Progenics common stock held in “street name” with respect to which the beneficial owner fails to give voting instructions to its broker, bank or other nominee, and shares of Progenics common stock with respect to which the beneficial owner otherwise fails to vote, will not be deemed present at the Progenics special meeting for the purpose of determining the presence of a quorum. There must be a quorum for the vote on the merger agreement proposal and the vote on the Progenics compensation advisory proposal to be taken at the Progenics special meeting. Failure of a quorum to be present at the Progenics special meeting will necessitate an adjournment of the meeting and will subject Progenics to additional expense.

Required Vote

The affirmative vote of the holders of a majority of shares of Progenics common stock outstanding and entitled to vote thereon is required to approve the merger agreement proposal. Progenics cannot complete the merger and the merger consideration will not be paid unless its stockholders approve the merger agreement proposal and the other closing conditions specified in the merger agreement are met. A Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee or any other failure of a Progenics stockholder to vote will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.

Approval of the Progenics adjournment proposal (whether or not a quorum, as defined under Progenics’ by-laws, is present) requires the affirmative vote of the holders of a majority of the shares of Progenics common stock present in person or represented by proxy at the Progenics special meeting and entitled to vote thereat. For purposes of the Progenics adjournment proposal, “shares of Progenics common stock present in person or represented by proxy” consist of votes “for” or “against” as well as elections to abstain from voting on the proposal. As a result, a Progenics stockholder’s abstention from voting on the Progenics adjournment proposal will have the same effect as a vote “AGAINST” the approval of the proposal. The failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting

 

86


Table of Contents

instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of the proposal.

Approval on an advisory (non-binding) basis of the Progenics compensation advisory proposal (assuming a quorum, as defined under Progenics’ by-laws, is present) requires the affirmative vote of the holders of a majority of the votes cast in person or by proxy at the Progenics special meeting. For purposes of the Progenics compensation advisory proposal, “a majority of votes cast” means the number of the votes cast “FOR” the proposal must exceed the number of the votes cast “AGAINST” the proposal. A Progenics stockholder’s abstention from voting, the failure of a Progenics stockholder who holds his or her shares in “street name” through a broker, bank or other nominee to give voting instructions to that broker, bank or other nominee, or any other failure of a Progenics stockholder to vote, will have no effect on the approval of this proposal, except to the extent it results in there being insufficient shares present at the Progenics special meeting to establish a quorum.

Stock Ownership of and Voting by Progenics Directors and Executive Officers

As of the close of business on the record date, Progenics’ directors and executive officers and their affiliates owned and had the right to vote in the aggregate 87,323 shares of Progenics common stock at the Progenics special meeting, which represents approximately 0.10% of the shares of Progenics common stock entitled to vote at the Progenics special meeting.

Each of Progenics’ directors and executive officers is expected, as of the date of this joint proxy statement/prospectus, to vote his or her shares of Progenics common stock “FOR” the merger agreement proposal, “FOR” the Progenics adjournment proposal and “FOR” the Progenics compensation advisory proposal, although none of Progenics’ directors or executive officers have entered into any agreement requiring them to do so.

Voting of Shares

Via the Internet or by Telephone

If you hold shares of Progenics common stock directly in your name as a stockholder of record, you may vote via the Internet or by telephone by following the instructions on the enclosed proxy card. In order to vote your shares via the Internet or by telephone, you will need the control number on your proxy card (which is unique to each Progenics stockholder to ensure all voting instructions are genuine and to prevent duplicate voting).

If you hold shares of Progenics common stock in “street name” through a broker, bank or other nominee, you may provide voting instructions via the Internet or by telephone only if Internet or telephone voting is made available by your broker, bank or other nominee. Please follow the voting instructions provided by your broker, bank or other nominee with these materials.

By Mail

If you hold shares of Progenics common stock directly in your name as a stockholder of record, in order to vote by mail, you may submit a proxy card. You will need to complete, sign and date your proxy card and return it using the postage-paid return envelope provided.

If you hold shares of Progenics common stock in “street name” through a broker, bank or other nominee, in order to provide voting instructions by mail you will need to complete, sign and date the voting instruction form provided by your broker, bank or other nominee with these materials and return it in the postage-paid return envelope provided. Your broker, bank or other nominee must receive your voting instruction form in sufficient time to vote your shares.

In Person

If you hold shares of Progenics common stock directly in your name as a stockholder of record, you may vote in person at the Progenics special meeting. Stockholders of record also may be represented by another person at the

 

87


Table of Contents

Progenics special meeting by executing a proper proxy designating that person and having that proper proxy be presented to the inspector of election with the applicable ballot at the Progenics special meeting.

If you hold shares of Progenics common stock in “street name,” meaning through a broker, bank or other nominee, you must obtain a written legal proxy from that broker, bank or other nominee and present it to the inspector of election with your ballot to be able to vote in person at the Progenics special meeting. To request a legal proxy, please contact your broker, bank or other nominee.

Generally

If your shares of Progenics common stock are held in an account at a broker, bank or other nominee, you must instruct the broker, bank or other nominee on how to vote your shares. In general, in accordance with applicable stock exchange rules, if your shares of Progenics common stock are held in “street name” and you do not instruct your broker how to vote your shares, your broker, in its discretion, may either leave your shares unvoted or vote your shares on routine matters. However, a broker is precluded from exercising its voting discretion with respect to non-routine or “significant” matters, such as the adoption of the merger agreement, the approval of the Progenics adjournment proposal and the approval of the Progenics compensatory advisory proposal. None of the proposals at the Progenics special meeting are routine matters. As a result, if you hold your shares in “street name,” through a brokerage account, your broker will not be able to exercise its discretion to vote uninstructed shares on any of the proposals presented at the Progenics special meeting.

If a beneficial owner of shares of Progenics common stock held in “street name” does not give voting instructions to its broker, bank or other nominee, then those shares will not be present in person or represented by proxy at the Progenics special meeting. A beneficial owner’s failure to instruct its broker, bank or other nominee how to vote shares of Progenics common stock held in “street name” will therefore have the same effect as a vote “AGAINST” the merger agreement proposal. A beneficial owner’s failure to instruct its broker, bank or other nominee how to vote shares of Progenics common stock held in “street name” will have no effect on the approval of the Progenics adjournment proposal or the Progenics compensation advisory proposal, except, with respect to the Progenics compensation advisory proposal, to the extent it results in there being insufficient shares present at the Progenics special meeting to establish a quorum.

All shares represented by each properly completed and valid proxy received before or at the Progenics special meeting will be voted in accordance with the instructions given in the proxy. If a Progenics stockholder signs a proxy card and returns it without giving instructions for voting on any proposal, the shares of Progenics common stock represented by that proxy card will be voted “FOR” the merger agreement proposal, “FOR” the Progenics adjournment proposal and “FOR” the Progenics compensation advisory proposal.

Your vote is very important, regardless of the number of shares you own. Whether or not you expect to attend the Progenics special meeting in person, please vote or otherwise submit a proxy to vote your shares as promptly as possible so that your shares may be represented and voted at the Progenics special meeting. If your shares of Progenics common stock are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction form furnished to you by such bank, broker or other nominee.

Revocability of Proxies; Changing Your Vote

You may change your vote or revoke your proxy at any time before your proxy is voted at the Progenics special meeting. You may revoke the authority granted by your proxy at any time prior to its use by:

 

   

sending a written revocation of a proxy to Progenics Pharmaceuticals, Inc., One World Trade Center, 47th Floor, Suite J, New York, New York 10007, Attention: Corporate Secretary that bears a date later than the date of the proxy you want to revoke and is received prior to the date of the Progenics special meeting;

 

88


Table of Contents
   

submitting a valid, later-dated proxy or voting instructions via the Internet or telephone before 11:59 p.m., Eastern Time, on the calendar day immediately preceding the Progenics special meeting, or by mail that is received prior to the Progenics special meeting; or

 

   

attending the Progenics special meeting (or, if the Progenics special meeting is adjourned or postponed, attending the adjourned or postponed meeting) and voting in person, which automatically will cancel any proxy previously given, or revoking your proxy in person, but your attendance at the Progenics special meeting alone will not revoke any proxy previously given.

If you hold your shares in “street name” through a broker, bank or other nominee, you must contact your broker, bank or other nominee to change your vote or obtain a written legal proxy to vote your shares if you wish to cast your vote in person at the Progenics special meeting.

Solicitation of Proxies; Expenses of Solicitation

This joint proxy statement/prospectus is being provided to holders of shares of Progenics common stock in connection with the solicitation of proxies by the Progenics Board to be voted at the Progenics special meeting and at any adjournments or postponements thereof. Progenics will bear all costs and expenses in connection with the solicitation of proxies, including the costs of filing, printing and mailing this joint proxy statement/prospectus for the Progenics special meeting. Progenics has engaged MacKenzie Partners, Inc. to assist in the solicitation of proxies for the Progenics special meeting and will pay MacKenzie Partners, Inc. an initial fee of approximately $125,000, plus additional fees to be determined at the conclusion of the solicitation and reimbursement of reasonable out-of-pocket expenses.

In addition to solicitation by mail, directors, officers and employees of Progenics or its subsidiaries may solicit proxies from stockholders by telephone, telegram, email, personal interview or other means. Progenics currently expects not to incur any costs beyond those customarily expended for a solicitation of proxies in connection with the adoption of a merger agreement. Directors, officers and employees of Progenics will not receive additional compensation for their solicitation activities, but may be reimbursed for reasonable out-of-pocket expenses incurred by them in connection with the solicitation. Brokers, dealers, commercial banks, trust companies, fiduciaries, custodians and other nominees have been requested to forward proxy solicitation materials to their customers, and such nominees will be reimbursed for their reasonable out-of-pocket expenses. Progenics will pay the costs associated with the Progenics special meeting and solicitation of proxies, including the costs of mailing the proxy materials.

Householding

“Householding” is a procedure Progenics adopted whereby stockholders of record who have the same last name and address and who receive the proxy materials by mail will receive only one copy of the proxy materials unless Progenics has received contrary instructions from one or more of the stockholders. This procedure reduces printing and mailing costs.

If you wish to receive a separate copy of the proxy materials, now or in the future, at the same address, or if you are currently receiving multiple copies of the proxy materials at the same address and wish to receive a single copy, you may contact Progenics at (646) 975-2500 by writing c/o the Corporate Secretary at Progenics’ corporate headquarters located at One World Trade Center, 47th Floor, Suite J, New York, New York 10007.

If you are a beneficial owner (your shares are held in the name of a bank, broker or other nominee), the bank, broker or other nominee may deliver only one copy of the joint proxy statement/prospectus to stockholders who have the same address unless the bank, broker or other nominee has received contrary instructions from one or more of the stockholders. If you wish to receive a separate copy of the joint proxy statement/prospectus now or in the future, you may contact Progenics at the address or phone number above and Progenics will promptly deliver

 

89


Table of Contents

a separate copy. Beneficial owners sharing an address who received multiple copies of the joint proxy statement/prospectus and wish to receive a single copy of proxy materials in the future, should contact their bank, broker or other nominee to request that only a single copy be delivered to all stockholders at the shared address in the future.

Adjournment

Progenics stockholders are being asked to approve a proposal that will give the Progenics Board authority to adjourn the Progenics special meeting from time to time for the purpose of soliciting additional proxies in favor of the merger agreement proposal if there are not sufficient votes at the time of the Progenics special meeting or any adjournment or postponement thereof, to approve the merger agreement proposal. If the Progenics adjournment proposal is approved, the Progenics special meeting could be adjourned to any date. In addition, the Progenics Board, with or without stockholder approval, could postpone the Progenics special meeting before it commences, whether for the purpose of soliciting additional proxies or for other reasons. If the Progenics special meeting is adjourned for the purpose of soliciting additional proxies, stockholders who have already submitted their proxies will be able to revoke them at any time prior to their use. If you sign and return a proxy and do not indicate how you wish to vote on any proposal, or if you indicate how you wish to vote on the merger agreement proposal or the Progenics advisory proposal and leave the Progenics adjournment proposal blank, your shares will be voted in favor of the Progenics adjournment proposal even if you voted against one or more of the other proposals.

Other Information

The matters to be considered at the Progenics special meeting are of great importance to the stockholders of Progenics. Accordingly, you are urged to read and carefully consider the information contained in or incorporated by reference into this joint proxy statement/prospectus and submit your proxy via the Internet or by telephone or complete, date, sign and promptly return the enclosed proxy card in the enclosed postage-paid envelope. If you submit your proxy via the Internet or by telephone, you do not need to return the enclosed proxy card.

Assistance

If you have any questions or require any assistance with authorizing a proxy or voting your shares, or if you need additional copies of the proxy materials, please contact:

MacKenzie Partners, Inc.

1407 Broadway, 27th Floor

New York, New York 10018

Toll: Free: (800) 322-2885

or

(212) 929-5500

Email: pgnx@mackenziepartners.com

 

90


Table of Contents

LANTHEUS HOLDINGS PROPOSAL I: APPROVAL OF THE STOCK ISSUANCE AND PROGENICS PROPOSAL I: ADOPTION OF THE MERGER AGREEMENT

General

This joint proxy statement/prospectus is being provided to holders of shares of Progenics common stock in connection with the solicitation of proxies by the Progenics Board to be voted at the Progenics special meeting and at any adjournments or postponements of the Progenics special meeting. At the Progenics special meeting, Progenics will ask its stockholders to vote on (i) the merger agreement proposal, (ii) the Progenics adjournment proposal and (iii) the Progenics compensation advisory proposal.

This joint proxy statement/prospectus is being provided to holders of shares of Lantheus Holdings common stock in connection with the solicitation of proxies by the Lantheus Holdings Board to be voted at the Lantheus Holdings special meeting and at any adjournments or postponements of the Lantheus Holdings special meeting. At the Lantheus Holdings special meeting, Lantheus Holdings will ask its stockholders to vote on (i) the stock issuance proposal and (ii) the Lantheus Holdings adjournment proposal.

The merger agreement provides for the merger of Merger Sub with and into Progenics, with Progenics continuing as the surviving corporation and a wholly-owned subsidiary of Lantheus Holdings. The merger will not be completed and the merger consideration will not be paid unless Progenics stockholders adopt the merger agreement and Lantheus Holdings stockholders approve the stock issuance and the other closing conditions specified in the merger agreement are met. A copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus. You are urged to read the merger agreement in its entirety because it is the legal document that governs the merger. For additional information about the merger, see “The Merger Agreement—Structure of the Merger” and “The Merger Agreement—Merger Consideration” beginning on pages 179 and 180, respectively, of this joint proxy statement/prospectus.

Upon completion of the merger, each share of Progenics common stock will be converted into the right to receive 0.31 of a share of Lantheus Holdings common stock and one CVR. Lantheus Holdings expects to issue up to approximately 26,844,956 shares of its common stock to Progenics stockholders in the merger. The actual number of shares of Lantheus Holdings common stock to be issued pursuant to the merger will be determined at the completion of the merger based on the number of shares of Progenics common stock outstanding at such time. In addition, shares of Lantheus Holdings common stock may be issued from time to time following the effective time of the merger to holders of Progenics equity awards on the terms set forth in the merger agreement. See “The Merger Agreement—Treatment of Progenics Stock Options” beginning on page 183 of this joint proxy statement/prospectus for a more detailed explanation. Based on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding as of March 18, 2020, it is estimated that, immediately after the completion of the merger, Lantheus Holdings stockholders will own approximately 60% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding) and former Progenics stockholders will own approximately 40% of the outstanding shares of common stock of the combined company (based on fully diluted shares outstanding). The exact equity stake of Lantheus Holdings stockholders and Progenics stockholders in the combined company immediately following the completion of the merger will depend on the number of fully diluted shares of Lantheus Holdings common stock and Progenics common stock outstanding immediately prior to the merger.

Background of the Merger and Certain Other Developments

The Lantheus Holdings Board and the Progenics Board, acting independently and with the advice of their respective management teams and financial advisors, periodically and in the ordinary course of business, review and assess their respective operations, financial performance, clinical, regulatory and commercial developments and industry conditions and their respective long-term business strategies and plans to enhance value for their

 

91


Table of Contents

respective stockholders. These reviews have, from time to time, included the evaluation and consideration of strategic acquisitions and divestitures, collaborations, in-licenses, out-licenses and other strategic transactions and opportunities.

In 2017 and 2018, the Lantheus Holdings Board and management team, in consultation with independent strategic consultants, developed and adopted a comprehensive strategic plan, key aspects of which included advancing its own clinical development program and potentially acquiring or licensing adjacent product portfolios and pipelines as a way to evolve outside of its existing product lines, diversify its existing revenue streams and accelerate revenue and margin growth. Since adopting that strategic plan, the Lantheus Holdings Board and management have, with advice from financial advisors including SVB Leerink, evaluated various transaction opportunities, including potential transactions with Progenics.

In June 2017, a representative of a potential strategic acquirer, which is referred to in this joint proxy statement/prospectus as Party A, discussed with Mr. Fabbio Party A’s potential interest in acquiring certain assets of Progenics. From time to time thereafter in 2017 and 2018, representatives of Progenics and representatives of Party A engaged in further discussions regarding a potential acquisition of such assets of Progenics by Party A, which included entering into a confidentiality agreement that did not include a standstill.

In late 2017, a member of Lantheus Holdings’ business development team reached out to a number of potential business partners and invited Progenics to an introductory meeting at the then-upcoming J.P. Morgan Healthcare Conference in San Francisco, California. In connection with that meeting, Lantheus Holdings and Progenics entered into a mutual confidentiality agreement on January 9, 2018. At that meeting on January 9, 2018, Mary Anne Heino, President and Chief Executive Officer and a director of Lantheus Holdings and other members of Lantheus Holdings management met with Mark Baker, Chief Executive Officer and a director of Progenics, Bryce Tenbarge, Senior Vice President, Commercial of Progenics, and another member of Progenics management and held general discussions about each company’s business and discussed ways in which the companies could work together regarding the commercialization of certain Progenics products.

In 2017, Lantheus Holdings retained a financial advisor to assist it in evaluating a range of potential strategic alternatives and in defining parameters to guide its strategic and financial decision-making. On February 21, 2018, that financial advisor presented its analysis and recommendations to the Lantheus Holdings Board and members of Lantheus Holdings management. The presentation covered business development and mergers and acquisitions strategies and identified two specific potential acquisition targets, including Progenics. An overview of Progenics’ business, a strategic rationale and other considerations for Lantheus Holdings’ potential acquisition of Progenics and high level projected financial information were presented and discussed.

On August 15, 2018, members of Lantheus Holdings management held a conference call with members of Progenics management to discuss potential collaboration opportunities around AZEDRA and other Progenics pipeline assets.

On November 2, 2018, members of Lantheus Holdings management met with the Chairman of the Lantheus Holdings Board, Brian Markison, to discuss potential business development opportunities, including a potential transaction with Progenics.

On November 27, 2018, Velan Capital L.P., which is referred to in this joint proxy statement/prospectus as Velan and which, as of such date, was known as Avego Capital, requested a brief phone call with Mr. Baker.

On November 29, 2018, Mr. Baker and representatives of Velan had a phone call to discuss the value of Progenics, including the value of AZEDRA and Progenics’ product candidate 1095.

On January 8, 2019, at the request of Lantheus Holdings, members of Progenics management and members of Lantheus Holdings management held preliminary discussions at the J.P. Morgan Healthcare Conference in

 

92


Table of Contents

San Francisco, California regarding ways in which Progenics and Lantheus Holdings could potentially work together in connection with the commercialization of certain Progenics products. The progress of the AZEDRA commercial launch was discussed, and Lantheus Holdings management again expressed their interest in the Progenics portfolio of products and described Lantheus Holdings’ capabilities related to radiopharmaceutical products.

On January 25, 2019, Robert Marshall, Chief Financial Officer of Lantheus Holdings, participated in discussions with representatives from SVB Leerink regarding certain capital markets and debt refinancing activities. During that meeting, SVB Leerink also presented a high level analysis of potential strategic acquisition transactions, including a possible all-stock acquisition of Progenics, based on publicly available information. On January 30, 2019, Ms. Heino and Etienne Montagut, Senior Vice President Corporate Development of Lantheus Holdings, met with representatives of SVB Leerink in-person to review the financial analysis prepared by SVB Leerink and to discuss potential next steps.

On February 18, 2019, Balaji Venkataraman, as Managing Partner of Velan, submitted a letter to the Progenics Board, which is referred to in this joint proxy statement/prospectus as the February 18 Letter. The February 18 Letter informed the Progenics Board of Velan’s ownership of Progenics common stock and described Velan’s views regarding Progenics’ product candidate 1095, the AZEDRA manufacturing and supply chain, AZEDRA’s commercial launch and other operational and financial matters relating to Progenics.

On February 21, 2019, the Lantheus Holdings Board convened a regularly scheduled meeting, during which meeting members of Lantheus Holdings management reviewed with the Lantheus Holdings Board Lantheus Holdings management’s ongoing evaluation of potential strategic business development plans and opportunities, which included a potential strategic transaction involving the acquisition of Progenics as well as other potential opportunities. During this meeting, the Lantheus Holdings Board evaluated the strategic rationale for making an acquisition proposal to Progenics. Representatives of SVB Leerink also attended and, together with members of Lantheus Holdings management, reviewed with the Lantheus Holdings Board a preliminary financial analysis relating to an acquisition of Progenics based on publicly available information, the strategic rationale for an acquisition of Progenics, financial analysis with respect to such an acquisition, various forms of consideration that could be provided to Progenics stockholders in such an acquisition, potential timing of due diligence, announcement and closing of such an acquisition, and the risks inherent in such an acquisition. The Lantheus Holdings Board thereafter authorized Lantheus Holdings management and SVB Leerink to explore a potential acquisition of Progenics with Progenics management.

On February 22, 2019, Peter Crowley, then the Chair of the Progenics Board, delivered a letter to Mr. Venkataraman confirming receipt of the February 18 Letter, noting that the Progenics Board would review the letter and consider Mr. Venkataraman’s comments.

Between February 22, 2019 and March 13, 2019, Mr. Crowley and Mr. Venkataraman had multiple interactions regarding, among other things, the February 18 Letter and the potential nomination by Velan of director candidates to the Progenics Board.

In late February 2019, at the direction of members of Lantheus Holdings management, a representative of SVB Leerink contacted Progenics director Bradley L. Campbell to initiate a discussion regarding Progenics’ strategic options. Mr. Campbell referred the SVB Leerink representative to Mr. Baker.

During the course of March 2019, a representative of SVB Leerink, on behalf of Lantheus Holdings, exchanged multiple communications with Mr. Baker to schedule a meeting to discuss a potential strategic transaction between Progenics and Lantheus Holdings. These communications resulted in the scheduling of a meeting between Progenics management and Lantheus Holdings management to be held on April 9, 2019.

On March 5, 2019, Lantheus Holdings formally engaged SVB Leerink as its financial advisor in connection with a possible acquisition of Progenics.

 

93


Table of Contents

On March 5, 2019, representatives of Party A and Progenics management held an in-person meeting to discuss an acquisition of certain assets of Progenics by Party A.

On March 6, 2019, the Chief Executive Officer of Party A sent to Mr. Baker correspondence indicating a specific interest in acquiring certain assets of Progenics and indicating a willingness to discuss potential terms of such a transaction.

On March 15, 2019, the deadline under Progenics’ by-laws for eligible stockholders to provide Progenics notice of the stockholder’s intention to nominate directors, Velan submitted to Progenics a notice of director nominations, in which Velan purported to notify Progenics of its nomination of six individuals, which are referred to in this joint proxy statement/prospectus as the Prior Velan Nominees, for election to the Progenics Board.

Also on March 15, 2019, representatives of Party A and Progenics management held a conference call regarding Party A’s potential acquisition of certain assets of Progenics.

Between March 15, 2019 and April 4, 2019, representatives of Party A and Progenics management engaged in due diligence conference calls in connection with a potential acquisition of certain assets of Progenics by Party A. Thereafter, Party A did not provide a term sheet or indication of interest and did not have any further communication with Progenics or its representatives until Party A contacted Progenics again in early June 2019.

On March 19, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Crowley discussed with the Progenics Board the February 18 Letter and the interactions that Mr. Crowley had with Mr. Venkataraman regarding the February 18 Letter and Velan’s notice of director nominations dated March 15, 2019. Mr. Crowley also noted for the Progenics Board that he was scheduled to meet in-person with Mr. Venkataraman on March 25, 2019. Following discussion, the Progenics Board approved the engagement of legal and professional advisors as needed to assist Progenics management relating to, among other things, outreaches to Progenics by Velan and other efforts by Velan to change the composition of the Progenics Board.

On March 25, 2019, Mr. Crowley and Mr. Baker met in person with Mr. Venkataraman to further discuss the views previously expressed by Mr. Venkataraman regarding Progenics.

Between March 27, 2019 and April 16, 2019, representatives of Progenics and representatives of Velan had multiple interactions relating to various topics, including Mr. Venkataraman’s views on the March 25, 2019 meeting, scheduling potential meetings between the Prior Velan Nominees and the Nominating and Corporate Governance Committee of the Progenics Board and whether Velan was a holder of record of shares of Progenics common stock at the time it submitted to Progenics a notice of director nominations, which was required by Section 3.05 of Progenics’ by-laws.

On April 1, 2019, the Progenics Board held a regular meeting. Also present were certain members of Progenics management and outside counsel to Progenics. Such outside counsel to Progenics provided the Progenics Board with an update regarding delivery by Velan of a notice of director nominations and the recent activities relating thereto. The Progenics Board then discussed a stockholder proposal to amend Section 3.03 of Progenics’ by-laws to allow certain holders of 20% of the outstanding shares of Progenics common stock to call special meetings of Progenics stockholders. Following discussion, the Progenics Board approved amended and restated by-laws of Progenics containing such amendment to Section 3.03 in the form proposed by a stockholder of Progenics.

On April 5, 2019, Velan filed with the SEC a Schedule 13D to report that, as of April 4, 2019, Velan collectively beneficially owned an aggregate of 6,233,796 shares, constituting approximately 7.4% of Progenics common stock outstanding. Following this Schedule 13D filing, representatives of SVB Leerink advised Lantheus Holdings of SVB Leerink’s historical and ongoing relationship with Mr. Venkataraman and his affiliated businesses.

 

94


Table of Contents

On April 9, 2019, members of Lantheus Holdings management and representatives of SVB Leerink met with members of Progenics management at Progenics’ offices in New York, New York. At that meeting, members of Lantheus Holdings management, at the direction of the Lantheus Holdings Board, expressed an interest in a potential acquisition of Progenics by Lantheus Holdings in which Progenics stockholders would receive Lantheus Holdings common stock. Progenics management expressed potential interest in a possible transaction and requested that a non-binding offer be provided.

On April 15, 2019, representatives of Velan communicated to representatives of Progenics that Velan sought to replace six of the seven members of the Progenics Board with Velan designees.

On April 18, 2019, members of Lantheus Holdings management and representatives of SVB Leerink met with the Finance & Strategy Committee of the Lantheus Holdings Board in New York and telephonically, during which the participants engaged in extensive discussions regarding its highest priority business opportunity, a potential acquisition of Progenics. The discussion focused on Progenics’ leading assets and the potential timing, structure and economic return of a potential transaction. The Finance & Strategy Committee thereafter instructed Lantheus Holdings management to engage with, and learn more about, Progenics and to present the opportunity to the full Lantheus Holdings Board at the next regularly scheduled meeting.

Between April 18, 2019 and April 24, 2019, the Nominating and Corporate Governance Committee of the Progenics Board held in-person meetings with the Prior Velan Nominees to discuss each such nominee’s qualifications to serve on the Progenics Board.

On April 22, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Baker provided an update regarding recent activities with Velan, noting that through a review of the Progenics record holder list, it had been determined that Velan was not a stockholder of record on March 15, 2019, as Progenics’ by-laws required to nominate directors to the Progenics Board (which requirement was present in Progenics’ by-laws at such time and prior to March 15, 2019). The Progenics Board discussed a proposed letter to be sent to Velan indicating that Velan’s notice of director nominations did not constitute a valid notice for the Annual Meeting of the Progenics Stockholders for 2019, which is referred to in this joint proxy statement/prospectus as the 2019 Progenics Annual Meeting, and following such discussion, the Progenics Board authorized the delivery of such letter to Velan. Mr. Baker then provided an update regarding Progenics’ separate discussions with representatives of Lantheus Holdings and Party A regarding potential strategic transactions with Progenics.

Also on April 22, 2019, Progenics’ outside counsel, O’Melveny & Myers LLP, which is referred to in this joint proxy statement/prospectus as O’Melveny, delivered a letter on behalf of Progenics to Velan and Mayer Brown LLP, which is referred to in this joint proxy statement/prospectus as Mayer Brown, Velan’s counsel, notifying Velan that its notice of director nominations delivered to Progenics on March 15, 2019 failed to comply with Section 3.05 of Progenics’ by-laws because Velan was not a stockholder of record when such notice was delivered. Progenics therefore notified Velan that Velan did not have the right to nominate any candidates for election to the Progenics Board at the 2019 Progenics Annual Meeting and that the Prior Velan Nominees are not eligible for election to the Progenics Board at the 2019 Progenics Annual Meeting.

At an in-person meeting held on April 23, 2019, the Lantheus Holdings Board reviewed, engaged in a discussion of, and approved, Lantheus Holdings’ strategic plan developed and presented by Lantheus Holdings management. Members of Lantheus Holdings management, with the support of external advisors, including a representative of SVB Leerink and an external clinical advisor, presented technical assessments of Progenics’ commercial portfolio, including AZEDRA and other pipeline assets of Progenics, and Progenics’ clinical development pipeline. During this discussion, the Lantheus Holdings Board, together with a representative of SVB Leerink, evaluated Progenics generally, its current status as a target of shareholder activism and potential terms of an acquisition of Progenics by Lantheus Holdings.

On April 24, 2019, the Nominating and Corporate Governance Committee of the Progenics Board met with Mr. Venkataraman. At that meeting, Mr. Venkataraman provided a revised proposal to Progenics to replace three

 

95


Table of Contents

of the seven members of the Progenics Board with Velan designees in lieu of nominating candidates for election to the Progenics Board at the 2019 Progenics Annual Meeting. Mr. Venkataraman requested a response from Progenics by April 25, 2019.

Also on April 24, 2019, the Lantheus Holdings Board convened a regularly scheduled meeting. At that meeting, members of Lantheus Holdings management provided an assessment and financial projections for a potential all-stock acquisition of Progenics, and following extensive discussion, the Lantheus Holdings Board determined it was advisable to continue exploring a potential acquisition of Progenics, and in connection therewith, authorized and approved the Finance & Strategy Committee of the Lantheus Holdings Board to review, consider and potentially approve a non-binding offer from Lantheus Holdings to acquire Progenics. Lantheus Holdings subsequently engaged White & Case LLP, counsel to Lantheus Holdings, which is referred to in this joint proxy statement/prospectus as White & Case, to assist Lantheus Holdings with various legal matters pertaining to a potential acquisition of Progenics. In addition, Lantheus Holdings subsequently retained additional consultants to support its due diligence efforts.

On April 26, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Crowley provided an update regarding recent activities with Velan. Mr. Crowley also discussed the potential engagement of Jefferies LLC, which is referred to in this joint proxy statement/prospectus as Jefferies, relating to the activities of Velan and the Progenics Board’s review and consideration of potential strategic transactions, including a potential strategic transaction with Lantheus Holdings or Party A. Following discussion and to assist the Progenics Board as it relates to the Velan matter and the consideration of potential strategic transactions, the Progenics Board approved the engagement of Jefferies on substantially the same terms as were provided to the Progenics Board.

On April 30, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Crowley provided an update on recent activities relating to Velan and its notice of director nominations. Mr. Baker then provided an update on activities related to Velan and described a proposed agreement Progenics counsel would present to Velan. The terms of the proposed agreement included, among other things: (i) Velan would agree to a one-year standstill; (ii) two new directors with radiopharma commercialization and supply chain management expertise would be identified by a third-party service provider and added to the Progenics Board; and (iii) each of the two new directors would be considered for serving on the relevant committees of the Progenics Board. Following discussion, the Progenics Board authorized Vinson & Elkins L.L.P., which is referred to in this joint proxy statement/prospectus as V&E, one of Progenics’ outside counsels, to deliver the proposed agreement to Velan’s counsel.

Also on April 30, 2019, Velan delivered a letter to Progenics, demanding the inspection of certain books, records and documents of Progenics pursuant to Section 220 of the DGCL. The letter stated that Velan was seeking books and records from Progenics to communicate with Progenics stockholders in connection with the election of directors at the 2019 Progenics Annual Meeting and other matters that may properly come before the 2019 Progenics Annual Meeting.

On May 1, 2019, Velan filed Amendment No. 1 to the Schedule 13D to report that, as of April 30, 2019, Velan collectively beneficially owned an aggregate of 7,679,578 shares, constituting approximately 9.1% of Progenics common stock.

On May 3, 2019, V&E delivered Progenics’ counterproposal to Velan’s April 24, 2019 proposal to Olshan Frome Wolosky LLP, which is referred to in this joint proxy statement/prospectus as Olshan, Velan’s outside counsel. Olshan shortly thereafter informed V&E that Velan would not respond to Progenics’ counterproposal.

On May 7, 2019, Progenics responded to Velan’s letter of April 30, 2019 by agreeing to make available certain information requested by Velan.

 

96


Table of Contents

Between May 7, 2019 and May 30, 2019, Progenics and Velan each filed preliminary proxy statements, amendments thereto, and definitive proxy statements, in each case with respect to the 2019 Progenics Annual Meeting and in the case of Velan related to a “withhold the vote” campaign against the re-election of two Progenics directors, Mr. Crowley and Michael D. Kishbauch, at the 2019 Progenics Annual Meeting. During this period and the subsequent period leading up to the 2019 Progenics Annual Meeting, Progenics and Velan each filed various press releases and stockholder letters in connection with the 2019 Progenics Annual Meeting.

On May 13, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and representatives of O’Melveny, Jefferies and V&E. Representatives of O’Melveny, Jefferies and V&E discussed market practices, fiduciary duties and other legal and financial considerations related to Velan’s “withhold the vote” campaign. Mr. Kishbauch, then a member of the Progenics Board, described the Nominating and Corporate Governance Committee process conducted to evaluate individuals identified by Velan as candidates for election, including in-person interviews and an evaluation of each such nominee’s requisite skills and experience relative to the criteria set forth in the charter of the Nominating and Corporate Governance Committee of the Progenics Board. Mr. Kishbauch and Nicole S. Williams, a member of the Progenics Board, then presented the unanimous recommendation of the Nominating and Corporate Governance Committee of the Progenics Board that each of the then-incumbent members of the Progenics Board, consisting of Messrs. Crowley, Baker, Campbell and Kishbauch, David A. Scheinberg, Dr. Karen J. Ferrante and Ms. Williams, all be nominated by the Progenics Board for re-election to the Progenics Board at the 2019 Progenics Annual Meeting. Following discussion, the Progenics Board approved the nomination to the Progenics Board of the persons nominated by the Nominating and Corporate Governance Committee.

On May 21, 2019, the Finance & Strategy Committee of the Lantheus Holdings Board met with members of Lantheus Holdings management to review preliminary due diligence findings from market research and expert assessments and financial analyses, and to discuss the possibility of making a non-binding offer to acquire Progenics in an all-stock transaction. The Finance & Strategy Committee instructed management to develop a non-binding offer for the acquisition of Progenics.

On May 28, 2019, the Progenics Board held a special meeting. Also present were representatives of management, O’Melveny, Jefferies and V&E. Representatives of O’Melveny, Jefferies and V&E presented to the Progenics Board potential rebuttal responses to Velan’s public statements concerning the upcoming 2019 Progenics Annual Meeting, as well as on the status of the activities and next steps with respect to Velan’s “withhold the vote” campaign. Representatives of Jefferies then discussed potential strategic transactions, including an initial strategic assessment regarding unsolicited interest that had been expressed by Party A to Progenics in March and April 2019 with respect to a potential strategic transaction involving certain assets of Progenics. The Progenics Board then discussed next steps relating to potential strategic transactions and authorized representatives of Jefferies to speak with potential acquirers of Progenics or potential acquirers of certain assets of Progenics, including, without limitation, following up with Party A on Progenics’ prior discussions in March and April 2019 regarding the acquisition of certain assets of Progenics.

Between June 2, 2019 and June 5, 2019, representatives of Jefferies, on behalf of Progenics, contacted representatives of one potential strategic acquirer, which is referred to in this joint proxy statement/prospectus as Party B, regarding its interest in potentially acquiring Progenics or certain assets of Progenics. Party B subsequently declined to pursue a potential acquisition of Progenics or a potential acquisition of certain assets of Progenics, and did not enter into a confidentiality agreement with Progenics. Representatives of Jefferies contacted Party A regarding potentially acquiring certain assets of Progenics. Party A subsequently informed representatives of Jefferies that Party A was not interested in pursuing discussions with Progenics regarding such an acquisition.

On June 5, 2019, representatives of Lantheus Holdings, including Mr. Markison, and representatives of SVB Leerink met with Mr. Baker and representatives of Jefferies. During this meeting, the representatives of Lantheus Holdings expressed their interest in an all-stock acquisition of Progenics at a premium to Progenics’ then-current

 

97


Table of Contents

stock price. Mr. Baker encouraged Lantheus Holdings to conduct initial due diligence and submit a proposal to acquire Progenics.

On June 7, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and a representative of O’Melveny. Mr. Baker provided an update to the Progenics Board regarding the activities and next steps with respect to Velan’s “withhold the vote” campaign. Mr. Baker then reported to the Progenics Board on the June 5, 2019 meeting between representatives of Lantheus Holdings, representatives of SVB Leerink, himself and representatives of Jefferies.

On June 13, 2019, V&E contacted Olshan and proposed a settlement between Progenics and Velan. Progenics’ proposal included, among other things that: (i) Velan would agree to a two-year standstill; (ii) two independent directors with relevant expertise, including, among others, public company board experience, oncology and pharmaceutical experience, financial expertise and development and commercial expertise, and who did not present environmental-social-and-governance concerns, would be added to the Progenics Board, with those directors being automatically re-nominated at the 2020 annual meeting of the Progenics stockholders; and (iii) none of the incumbent Progenics directors would be required to resign.

During the week of June 17, 2019, representatives of Lantheus Holdings conducted preliminary due diligence telephone calls with Progenics management.

On June 20, 2019, the Finance & Strategy Committee of the Lantheus Holdings Board met and reviewed an updated financial analysis of a potential Progenics acquisition with members of Lantheus Holdings management and representatives of SVB Leerink. The Finance & Strategy Committee thereafter recommended discussing a proposed non-binding offer to acquire Progenics with the full Lantheus Holdings Board at its upcoming special meeting.

On June 21, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and a representative of O’Melveny. Mr. Baker provided an update to the Progenics Board regarding the activities and next steps with respect to Velan’s “withhold the vote” campaign.

Also on June 21, 2019, the Lantheus Holdings Board convened a special meeting telephonically to consider an offer for Progenics. Members of Lantheus Holdings management updated the Lantheus Holdings Board on recent interactions with the Progenics management team and presented a strategic and financial analysis of a proposed non-binding offer. A representative of SVB Leerink advised on the rationale for the transaction, and a representative of White & Case advised the Lantheus Holdings Board with respect to its fiduciary duties in connection with its decision concerning a proposed acquisition of Progenics. The Lantheus Holdings Board unanimously approved a non-binding offer to acquire Progenics in an all-stock transaction that would result in Progenics stockholders holding a pro forma fully diluted ownership of the combined company of approximately 34.5%.

Later on June 21, 2019, Lantheus Holdings submitted to Progenics a written, non-binding proposal to acquire Progenics in an all-stock transaction on the terms the Lantheus Holdings Board approved that would result in Progenics stockholders holding pro forma fully diluted ownership of the combined company of approximately 34.5%. This proposal is referred to in this joint proxy statement/prospectus as the June 21 Proposal. The June 21 Proposal implied an exchange ratio of 0.2477 of a share of Lantheus Holdings common stock for each share of Progenics common stock and represented a premium of 52.2% to the then 30-day volume weighted average share price of Progenics common stock. The June 21 Proposal was subject to satisfactory completion of due diligence, the negotiation of a mutually acceptable definitive agreement, the approval by the Lantheus Holdings Board and the approval by stockholders of both companies. Lantheus Holdings stated in the June 21 Proposal that it was prepared to conduct due diligence in a period of approximately six weeks and would enable Progenics to engage in reverse due diligence during that period. Lantheus Holdings also requested an exclusivity period of six weeks.

 

98


Table of Contents

On June 24, 2019, at Jefferies’ request, representatives of Jefferies discussed with representatives of SVB Leerink certain aspects of Lantheus Holdings’ June 21 Proposal including the status of Lantheus Holdings’ due diligence process.

On June 25, 2019, Olshan delivered to V&E Velan’s counterproposal to Progenics’ June 13, 2019 settlement proposal under which, among other things: (i) Velan would agree to a one-year standstill; (ii) two independent directors with the appropriate expertise and who did not present environmental-social-and-governance concerns would be added to the Progenics Board; and (iii) one incumbent director would resign.

On June 26, 2019, V&E delivered to Olshan Progenics’ response to Velan’s June 25, 2019 settlement proposal. Progenics proposed that, among other things: (i) Velan would agree to a one-year standstill; (ii) two independent directors identified by Velan with appropriate experience and who did not present environmental-social-and-governance concerns would be added to the Progenics Board; (iii) each of the two new directors would be considered for serving on the relevant committees of the Progenics Board; (iv) the Progenics Board would form a new commercialization committee to which it would appoint one of the new directors; (v) one incumbent director would agree not to stand for re-election at the 2020 annual meeting of the Progenics stockholders; and (iv) the size of the Progenics Board would be fixed at eight through the 2020 annual meeting of the Progenics stockholders.

Later on that day, Olshan conveyed to V&E that Velan was willing to accept Progenics’ latest settlement proposal subject to two conditions: (i) Progenics agreement to elect a new board chair for the Progenics Board, and (ii) Velan’s right to designate two board observers to attend the Progenics Board meetings.

On June 27, 2019, V&E informed Olshan that Progenics could not agree to Velan’s proposal to add two observers to the Progenics Board. Later that day, Olshan informed V&E that Velan declined Progenics’ settlement proposal.

On June 27, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and representatives of O’Melveny and Jefferies. Mr. Baker provided an update to the Progenics Board regarding the activities and next steps with respect to Velan’s “withhold the vote” campaign. The Progenics Board then evaluated and discussed Lantheus Holdings’ June 21 Proposal, and Jefferies reviewed the financial aspects of the June 21 Proposal, including Progenics financial projections prepared by Progenics management and Lantheus Holdings financial projections based on Wall Street research and estimates. Following discussion, the Progenics Board authorized Jefferies to respond to Lantheus Holdings to ask that Lantheus Holdings increase the value offered in the June 21 Proposal, but also make clear that the Progenics Board would support Lantheus Holdings conducting further due diligence under a confidentiality agreement. The Progenics Board then reviewed certain relationship information provided by Jefferies. In addition, the Progenics Board approved a market check involving Jefferies’ outreach to five potential strategic acquirers (none of which were Party A or Party B) discussed at such meeting based on, among other things, the likelihood of potential interest in acquiring Progenics and such potential acquirers’ presence in the prostate cancer or radiopharmaceutical industry.

On June 27, 2019, representatives of Jefferies communicated to representatives of SVB Leerink that the Progenics Board supported Lantheus Holdings conducting further due diligence under a confidentiality agreement, but required that the value offered by Lantheus Holdings in the June 21 Proposal be increased.

On June 27, 2019, Progenics and Lantheus Holdings began negotiating a new confidentiality agreement, which was executed on July 15, 2019, that included a mutual standstill provision that would automatically terminate (i) as it restricted Lantheus Holdings, upon Progenics’ entry into a merger agreement with a third party and (ii) as it restricted Progenics, upon Lantheus Holdings’ entry into a merger agreement with a third party.

Between June 30, 2019 and July 8, 2019, representatives of Jefferies, at the Progenics Board’s instruction, contacted representatives of five potential strategic acquirers regarding potentially acquiring Progenics (none of

 

99


Table of Contents

which were Party A or Party B). By July 17, 2019, all such potential strategic acquirers had declined to pursue the opportunity to bid to acquire Progenics, except that one potential strategic acquirer expressed interest in potentially acquiring a specific development program of Progenics. None of those potential strategic acquirers entered into a confidentiality agreement with Progenics.

On July 2, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Baker provided an update to the Progenics Board regarding the activities and next steps concerning Velan’s “withhold the vote” campaign. Mr. Baker then provided the Progenics Board with an update regarding ongoing investor meetings and initial, preliminary voting results relating to the upcoming 2019 Progenics Annual Meeting. Mr. Baker then provided an update on discussions with Lantheus Holdings regarding a potential acquisition of Progenics by Lantheus Holdings, initial feedback Jefferies received from other potential strategic acquirers regarding a potential acquisition of Progenics and next steps regarding Progenics entering into a confidentiality agreement with Lantheus Holdings and other due diligence matters relating thereto.

On July 9, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Baker provided the Progenics Board with an update regarding the activities relating to Velan’s “withhold the vote” campaign and steps to prepare for possible external communications after the 2019 Progenics Annual Meeting. Mr. Fabbio presented to the Progenics Board terms of an engagement letter negotiated with Jefferies for Jefferies to serve as financial advisor relating to a potential strategic transaction involving Progenics. Following discussion, the Progenics Board approved entry into the engagement letter.

Later on July 9, 2019, Progenics executed an engagement letter for Jefferies to serve as Progenics’ financial advisor in connection with Progenics’ evaluation, consideration and negotiation of a strategic transaction relating to the process authorized by the Progenics Board on June 27, 2019.

On July 11, 2019, Progenics held the 2019 Progenics Annual Meeting. At the 2019 Progenics Annual Meeting, each of Messrs. Crowley and Kishbauch did not receive a majority of the votes cast. In accordance with Progenics’ by-laws, Messrs. Crowley and Kishbauch each submitted a contingent resignation to the Progenics Board.

Also on July 11, 2019, the Progenics Board held a special meeting. Also present were representatives of management, O’Melveny, Jefferies and V&E. The Progenics Board, together with representatives of O’Melveny, Jefferies and V&E, discussed preliminary voting results of the 2019 Progenics Annual Meeting and the process and timeline for the consideration of contingent resignations submitted by Messrs. Crowley and Kishbauch in light of the preliminary voting results for the election of Progenics directors.

On July 12, 2019, Progenics issued a press release announcing the preliminary voting results of the 2019 Progenics Annual Meeting, which noted that Messrs. Baker, Campbell and Scheinberg, Dr. Ferrante and Ms. Williams received a majority of the votes cast at the 2019 Progenics Annual Meeting, and Messrs. Crowley and Kishbauch did not.

On July 15, 2019, Mr. Baker and Mr. Campbell participated in a call with representatives of Velan in which the results of the 2019 Progenics Annual Meeting were discussed.

On July 16, 2019, representatives of Lantheus Holdings and its advisors were provided access to an electronic data room populated with information about Progenics for due diligence purposes. Thereafter until the original merger agreement’s execution on October 1, 2019, Lantheus Holdings and its advisors participated in numerous in-person and telephonic due diligence sessions with Progenics and its advisors.

At an in-person meeting of the Lantheus Holdings Board on July 17, 2019, Lantheus Holdings management reviewed an updated, detailed analysis of the potential Progenics transaction. Following the review, the Lantheus Holdings Board discussed with members of Lantheus Holdings management areas on which due diligence should initially be focused, including site activation, patient treatment pathways and manufacturing and supply chain.

 

100


Table of Contents

On July 18, 2019, at its regular in-person meeting, members of the Finance & Strategy Committee of the Lantheus Holdings Board discussed with members of Lantheus Holdings management integration issues and certain financial aspects of the proposed acquisition of Progenics, including dilution to Lantheus Holdings

stockholders, and valuation and premium ranges for Progenics. Later on July 18, 2019, the full Lantheus Holdings Board discussed at its regular in-person meeting various potential business development opportunities, including the proposed acquisition of Progenics. The Lantheus Holdings Board and management discussed due diligence matters, including Progenics’ commercial portfolio, such as AZEDRA and other pipeline assets of Progenics and the most efficient way to conduct due diligence.

On July 19, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Baker provided the Progenics Board with an update regarding Progenics’ review of strategic transactions, including the lack of interest from the potential strategic acquirers approached by Jefferies at the Progenics Board’s request. Representatives of Jefferies advised that one potential strategic acquirer was potentially interested in acquiring a specific development program of Progenics, but, after discussion, the Progenics Board declined to pursue this transaction in favor of continuing to pursue the potential acquisition of Progenics by Lantheus Holdings. Mr. Baker then discussed the recent execution of the confidentiality agreement with Lantheus Holdings and the commencement of the due diligence process with Lantheus Holdings.

Also on July 19, 2019, the independent inspector of election for the 2019 Progenics Annual Meeting delivered its final report to Progenics. The report confirmed that all the Progenics nominees for the Progenics Board other than Messrs. Crowley and Kishbauch, received a majority of the votes cast. The report also indicated that the Progenics stockholders approved, on an advisory basis, the compensation of Progenics’ named executive officers.

On July 25, 2019, the Progenics Board held a special meeting. Also present was Mr. Fabbio. Mr. Baker provided the Progenics Board with an update regarding discussions with Lantheus Holdings relating to the due diligence process and the forthcoming due diligence calls scheduled for the week of July 29, 2019.

On July 26, 2019, Olshan contacted V&E to present a new settlement proposal. Under the new proposal, among other things: (i) the Progenics Board would accept the resignations of Messrs. Crowley and Kishbauch; (ii) Velan would have the right to designate two directors to the Progenics Board, and Progenics and Velan would jointly designate a third director; (iii) Progenics would adopt stock ownership guidelines for directors; and (iv) Velan would agree to a standstill lasting until 30 days before the opening of the nomination window for the 2020 annual meeting of the Progenics stockholders.

On July 30, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and a representative of O’Melveny. The representative of O’Melveny reviewed for the Progenics Board its fiduciary duties under Delaware law. Mr. Baker then described the recent settlement offer from Velan. Following discussion, the Progenics Board agreed that it would consider a reasonable and appropriate response to the settlement offer from Velan. Mr. Baker then provided the Progenics Board with an update regarding discussions with Lantheus Holdings and that due diligence continued to progress with several teleconferences scheduled for the coming days to discuss, among other items, clinical, commercial and manufacturing issues related to Progenics’ products and product pipeline.

On July 31, 2019, representatives of Progenics and its advisors were provided access to an electronic data room populated with information about Lantheus Holdings for purposes of performing reverse due diligence on Lantheus Holdings.

On August 6, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and a representative of O’Melveny. Mr. Baker provided the Progenics Board with an update regarding discussions with Lantheus Holdings and noted that due diligence was progressing and that Lantheus Holdings was scheduled for a site visit of the manufacturing facility for AZEDRA. The Progenics Board then discussed the status of the

 

101


Table of Contents

potential acquisition of Progenics by Lantheus Holdings, including posing questions to Mr. Baker regarding the status and timing of the due diligence process with Lantheus Holdings.

On August 7, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and a representative of O’Melveny. The Progenics Board discussed the certified voting results of the 2019 Progenics Annual Meeting. The Nominating and Corporate Governance Committee of the Progenics Board recommended that the contingent resignations of Messrs. Crowley and Kishbauch be accepted. Following discussion, the Progenics Board accepted the contingent resignations of Messrs. Crowley and Kishbauch, with an effective date of October 17, 2019, 90 days following the certification of the voting results for the 2019 Progenics Annual Meeting. The resignations could also take effect sooner if the Progenics Board determined the responsibilities of Messrs. Crowley and Kishbauch had been sufficiently transitioned to the remaining Progenics directors, but such transition of responsibilities did not occur earlier than October 17, 2019.

On August 8, 2019, Progenics announced the Progenics Board’s acceptance of the resignations of Messrs. Crowley and Kishbauch, the reconstitution of the Progenics Board committees, certain amendments to committee charters and, in consultation with Frederic W. Cook & Co., the adoption of stock ownership guidelines for non-employee directors and executive officers. Progenics also announced that the members of the newly reconstituted Nominating and Corporate Governance Committee of the Progenics Board would reach out to stockholders to solicit feedback regarding stockholder value creation. Progenics’ announcement also welcomed stockholder input on new candidates for the Progenics Board.

On August 9, 2019, representatives of Lantheus Holdings’ manufacturing and quality teams conducted a site visit at Progenics’ manufacturing facility for AZEDRA in Somerset, New Jersey as part of Lantheus Holdings’ due diligence on AZEDRA.

On August 11, 2019, a representative of Jefferies contacted a representative of SVB Leerink to request that Lantheus Holdings submit a revised non-binding indication of interest prior to continuing in-depth due diligence.

On August 12, 2019, Velan issued a press release in response to Progenics’ Q2 2019 financial results, noting its intention to take action on behalf of all stockholders, including by seeking to remove and replace members of the Progenics Board.

On August 14, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and representatives of O’Melveny and Jefferies. Mr. Baker provided the Progenics Board with an update regarding discussions with Lantheus Holdings and noted that due diligence was progressing and that the AZEDRA manufacturing facility site visit by Lantheus Holdings had been completed. The Progenics Board then discussed matters relating to the potential acquisition of Progenics by Lantheus Holdings, including the potential timing of such a transaction. The Progenics Board also discussed Velan’s August 12, 2019 press release and potential terms of a counter offer to Velan’s most recent settlement offer of July 26, 2019. Following discussion, the Progenics Board requested additional information regarding the terms of a proposed settlement with Velan and determined to consider a potential counter offer further during the next meeting of the Progenics Board.

Also on August 14, 2019, Mr. Venkataraman told a representative of SVB Leerink that Mr. Venkataraman knew that SVB Leerink was advising Lantheus Holdings with respect to a potential transaction with Progenics and that Mr. Venkataraman was opposed to any such proposed transaction, notwithstanding that deal terms had not been finalized or announced as of that time. On a conference call with members of Lantheus Holdings management, representatives of SVB Leerink notified members of Lantheus Holdings management of this discussion, and summarized in general terms SVB Leerink’s historical and ongoing relationship with Mr. Venkataraman and his affiliated businesses.

Between August 14, 2019 and September 9, 2019, the Velan Group actively traded in Progenics common stock. During this period, the Velan Group purchased an aggregate of 1,555,991 shares of Progenics common stock for

 

102


Table of Contents

a total purchase price of approximately $6.8 million and amounting to 1.80% of Progenics’ outstanding shares of common stock. The number of shares bought and the aggregate purchase price are based on the Velan Group’s public filings.

On August 16, 2019, the Finance & Strategy Committee of the Lantheus Holdings Board held a telephonic conference call with members of Lantheus Holdings management and representatives of SVB Leerink and White & Case, to discuss certain due diligence findings, including Progenics’ commercial portfolio, such as AZEDRA and other pipeline assets of Progenics, an updated financial analysis of Progenics and the impact on Lantheus Holdings of acquiring Progenics.

On August 19, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and representatives of O’Melveny and Jefferies. Mr. Baker provided an update regarding the potential acquisition of Progenics by Lantheus Holdings. The Progenics Board discussed reverse due diligence to be conducted by Progenics and its advisors on Lantheus Holdings, valuation considerations relating to Progenics and Lantheus Holdings, the process for a transaction with Lantheus Holdings and other similar considerations relating to a potential acquisition of Progenics by Lantheus Holdings. The Progenics Board then discussed the status of communications and engagement with Velan and potential alternatives for a settlement with Velan. The Progenics Board then agreed that Mr. Baker would further engage with Progenics’ advisors to prepare a framework for a potential settlement with Velan.

On August 19, 2019, the Lantheus Holdings Board convened a special meeting telephonically, during which it reviewed the current status of the proposed acquisition of Progenics with members of Lantheus Holdings management and representatives of SVB Leerink and White & Case, including an updated financial analysis and certain due diligence findings by management of Lantheus Holdings and its advisors relating to, among other things, Progenics’ commercial portfolio, such as AZEDRA and other pipeline assets of Progenics. Based in part on these updated findings, the Lantheus Holdings Board authorized management to present to Progenics a revised non-binding offer that would result in Progenics stockholders holding approximately 34.8% pro forma ownership on a fully diluted basis of the combined company implying an exchange ratio of 0.2520 of a share of Lantheus Holdings common stock for each share of Progenics common stock. This proposal represented a reduction of approximately $0.95 per share compared to the previous offer and a 60.8% premium to the one-day prior share price of Progenics common stock.

Later on August 19, 2019, Lantheus Holdings provided a revised and updated non-binding offer letter to Progenics in which it proposed acquiring Progenics in an all-stock transaction that would result in Progenics stockholders holding pro forma fully diluted ownership in the combined company of approximately 34.8%, implying an exchange ratio of 0.2520 of a share of Lantheus Holdings common stock for each outstanding share of Progenics common stock, which is referred to in this joint proxy statement/prospectus as the August 19 Proposal. Lantheus Holdings also requested an exclusivity agreement in connection with the August 19 Proposal.

On August 22, 2019, the Progenics Board held a special meeting. Also present were Mr. Fabbio and representatives of O’Melveny and Jefferies. Representatives of Jefferies, at the request of the Progenics Board, reviewed the terms of the August 19 Proposal. The Progenics Board, together with representatives of Jefferies, discussed the August 19 Proposal and preliminary financial analysis relating to the valuations of Progenics and Lantheus Holdings, the implied premium presented in the August 19 Proposal, the request for exclusivity by Lantheus Holdings and the likel